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Inside Lending: past present and predictions

By
Mortgage and Lending with Academy Mortgage NMLS 180670

QUOTE OF THE WEEK…“Success seems to be
largely a matter of hanging on after others have let go.”–William
Feather, American author and publisher


INFO THAT HITS US WHERE WE LIVE
…Last week’s housing news did give all
of us in the industry a few more things to hang onto. First, we saw new
single-family home sales go up 5.7% in September
, to a 313,000 annual
rate. Next, it was nice to see the supply of new homes drop to 6.2 months.
The inventory is now at the lowest level on record.

Then, Case-Shiller’s 20-City Composite Home Price index was up for the fifth
month in a row in August
and 16 of the 20 metros tracked saw an
improvement in their annual rates of change.
Case-Shiller called this
“a modest glimmer of hope” for the housing market. We’ll take it.
Finally, the Pending Home Sales Index dropped a bit in September but was UP 6.4% year over year. This gauges signed contracts on existing homes
that are not yet closed.

BUSINESS TIP OF THE WEEK

…Be decisive in recognizing mistakes, even if
they’re your own. When you see something wrong, don’t dwell on it–fix it!.
That’s the fastest way to success.

FOREIGN PROGRESS, DOMESTIC BLISS…Just the
announcement of a plan to solve the debt crisis in Europe was more than
enough to send investors into a state of ecstasy. Well, that may be a bit of an
exaggeration, but the Wall Street faithful certainly felt upbeat enough to send
all three market indexes solidly northward for the week. This makes four
straight weekly gains for the broadly based S&P 500.
But good news
from foreign lands couldn’t take all the credit.

Over here, Q3 corporate earnings reports were mostly better than expected. Personal
Income was up for September, as was Personal Spending,
showing the consumer has the money to participate in the recovery and is willing to do so. Even the
most strident recession evangelists were silenced by Thursday’s Advance Q3
GDP which had the economy expanding at a 2.5% annual rate.
This is nicely
above Q2′s 1.3% rate, although not yet high enough for the job growth we need.

For the week, the Dow ended UP 3.6%, at 12231; the S&P 500 was UP 3.8%, to
1285; and the Nasdaq also gained 3.8%, to 2737.

Europe’s blueprint to ease its debt crisis got investors dumping bonds and
moving into riskier equities. The selling sent bond prices down, although some
of those losses were recovered on Friday. The FNMA 3.5% bond we watch ended the
week down .05, at $100.26. But there was little change in mortgage rates,
as national averages pretty much held steady, according to Freddie Mac’s weekly survey. Of course, interest rates could rise if mortgage bonds lose their investor appeal.

DID YOU KNOW?…The Employment Report, released by the Bureau of
Labor Statistics on the first Friday of each month, contains data for the
period ending on day 12 of the prior month.

This Week’s Forecast
LOOKING AT MANUFACTURING, THE FED, OCTOBER JOBS… The week begins with a couple of good readings on manufacturing,
the Chicago PMI and the ISM Index both expected to
continue showing expansion. The Federal Reserve stages another Federal
Open Market Committee
meeting this week. The Funds rate
will stay where it is, but the policy statement on Wednesday will be
scrutinized as usual.

The key economic news for the week will be the October Employment Report on
Friday. Unfortunately, the forecast is for just 88,000 new jobs, not enough to
bring the Unemployment Rate down from 9.1%.

The Week’s Economic Indicator Calendar

Weaker than expected economic data tends to send bond prices up and
interest rates down, while positive data points to lower bond prices and rising
loan rates.

 

Thisis an advertisement for Carly Companion West. The material provided is for informational and educational purposes only and should not be construed as investment and/or mortgage advice, or a commitment to lend. Although the material is deemed to be accurate and reliable, there is no guarantee of its accuracy. The material contained in the newsletter is the property of Academy Mortgage and cannot be reproduced for any use without prior written consent. It is designed for real estate and other financial professionals only. It is not intended for consumer distribution. The material does not represent the opinion of Academy Mortgage. NMLS# 180670

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