inflation: 2017 Guide to Mortgage Rates
- 01/30/17 08:55 AM
Mortgage rates are determined by the supply and demand for mortgage bonds in the bond market. Why Mortgage Bonds? When you get a mortgage in the US, your mortgage company is getting the money from Fannie Mae, Freddie Mac or other "securitizers". These "securitizers" get their money by issuing bonds to bond market investors. These bonds are called "mortgage bonds" or "mortgage backed securities". Therefore, the mortgage rate you pay is really determined by the supply and demand for mortgage bonds in the bond market. The Role of the Federal Reserve As you can see from the chart, the Fed owned zero ($0) mortgage bonds … (0 comments)
inflation: Trumponomics: Three Reasons Why Mortgage Rates Have Gone Up
- 11/16/16 03:45 AM
We are in the midst of a global bond market sell-off that has erased over $1 trillion of value from bonds all across the world, including US mortgage bonds. When mortgage bond prices decline, mortgage rates go up… and mortgage bond prices have fallen off a cliff recently (see chart). Here are three reasons why:
1 – Risk of Inflation Due to Tariffs A “tariff” is a tax on foreign goods and services. Most free trade agreements reduce or eliminate tariffs. Mr. Trump has promised to scale back or exit many of our country’s free trade agreements that are currently in place. … (0 comments)
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