- Treasury's safe haven as 10yr bouncing off 4.50% support range.
- Fed Fund's contract today show trader's see a 44% chance the Fed will lower its target for overnight bank lending to 4.75% form 5.25% at its next meeting on September 18th.
- Indy Mac said it would hire about 800 former employees of American Home Mortgage Investment Co., & take over 90 of the lenders direct-to-consumer offices to make prime loans.
- LandAmerica Financial Group will cut 1,100 jobs in the 2nd half of 2007 to reduce costs as mortgage originations decline.
- Per Fitch - US housing market is likely to be more severe than anticipated during the rest of 2007, mainly due to tighter mortgage standards & disrupted mortgage markets.
- 2008 will be a challenging year for the housing sector
- Lowered its ratings to a negative outlook on most homebuilders
- Expects revenues to drop 30% to 35% on average
- Pre-tax profit to plummet 75% to 80%
- It considers excess inventory as the most challenging issue for housing
- US stock's advanced as improved earnings prospects for technology & energy companies:
- Apple Inc unveil it new iPod media player
- Seagate Technology said its hard-disk drives for computers sales climbed on back-to-school season.
- Exxon led energy higher after crude oil prices gained
- Fed Minutes:
- Fed officials had underestimated the contagion from sub-prime credit markets to less risky borrowers
- Policy makers forecast housing would restrain growth "for some time" and developments in mortgage markets suggested.
- The Fed is not convinced that a slowdown in inflation would last
- INFLATION REMAINS THE MOST SIGNIFICANT POLICY RISK
- Structured Investment Vehicles - Commercial Paper - are facing shortages as investors refuse to buy debt instruments secured by asset back commercial paper
- One Year ARM rates jumped to 6.51% from 5.84% and greater than 30yr fixed rates for the first time ever
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