The Petalumahomes.com Realty WebLog

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Mortgage Market Update - Happy New Year!

Brent Blaustein, CMPS Mortgage Consultant Princeton Capital (707) 769-4327

December 31st, 2007 · No Comments

Last Week In Review

     
  “YOUTH IS WHEN YOU’RE ALLOWED TO STAY UP LATE ON NEW YEAR’S EVE. MIDDLE AGE IS WHEN YOU’RE FORCED TO.” Bill Vaughn And battle weary Traders may be looking to hang it up early for the night, after enduring days and weeks on end of extreme market volatility. And last week was no exception, as the assassination of former Pakistani Prime Minister and current opposition leader Benazir Bhutto brought on even more volatile moves in the markets.There is global concern over the possibility that the Pakistani government may become destabilized - and if this should happen, which political faction may end up in power with control over its nuclear arsenal. This is a very good example of how unforeseen political events from around the world can impact home loan rates, as Bonds trade in response to the headlines. Following the assassination, Bond prices moved higher upon the increased demand for the “safe haven” found in Bonds, and home loan rates improved by about .125% for the week overall.  

 

  Forecast For The Week

     
  The financial markets will be closed early on Monday, and fully closed on Tuesday in observance of the New Year. But the balance of the week contains several important economic releases, including the “Minutes” from the Federal Reserve’s last policy meeting. Since not all voting members agreed with the decision to cut the Fed Funds Rate by .25%, the discussion between voting and non-voting members could be fairly interesting, and provide insight as to the Fed’s moves in the New Year.Remembering that when Bond pricing moves higher, home loan rates move lower - and vice versa - the chart below shows how volatile the action has been in recent days and weeks. This is why we feel it is so important for us to be well informed, and in turn, keep you advised. The climate has been volatile both for rates and the mortgage industry at large - so we know that it is more important than ever that you, your friends, family members, clients and neighbors have an association with a real professional who is “in the know”.

Have a terrific and safe New Year’s Eve.  Make it a great 2008!

Tags: Brent Blaustein

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