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Weekly Mortgage Update

By AgentImage, Monday, March 15, 2010
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Eve Robin Jarrett
MANAGING DIRECTOR
Senior Mortgage Consultant
Manhattan Mortgage
Office: 631-324-1555 x 25
Blackberry: 631-697-3366
e-Fax: 631-514-3654
Email: EJarrett(at)manhattanmortgage(dotted)com

For the week of Mar 15, 2010 // Vol. 8, Issue 11
Last Week in Review

“IF WE HAD NO WINTER…THE SPRING WOULD NOT BE SO PLEASANT.” 17th-Century poet Anne Bradstreet’s words ring true not only for the seasons, but also for last week’s Retail Sales numbers. Just days before Sunday’s “spring forward” into Daylight Savings Time, the retail sector looked to be unfreezing and showing at least a little spring in its step.

As you can see in the chart below, Retail Sales for February were reported last Friday at 0.3%, which was better than the previous month’s reading and much better than the -0.2% expected. Despite the good news, however, we need to keep in mind that it will be subject to future revisions – just like we saw in Friday’s report, in which last month’s decent 0.5% reading was revised sharply lower to just 0.1%.

———————–
Chart: Retail Sales (Month-Over-Month)

The better-than-expected Retail Sales was good news for the economy, but it could also lead to inflation trouble ahead. Remember, inflation is the archenemy of Bonds. Just last week, fears of inflation in China pressured Bonds around the globe. And here in the US, a number of Fed members have already mentioned inflation as an increasing concern.

And it isn’t just Fed officials who have been warning against inflation; investors around the globe are having increased doubts. Massive debt and massive balance sheet expansion – combined with near zero interest rates for a long period of time – will no doubt conjure a recipe for inflation.

The question is this: Once inflation rears its ugly head…will the Fed have the courage and the will to kill the monster by tightening policy, amidst enormous political pressure not to do so? As you’ll see in the Forecast section below, the next Fed meeting is taking place this week, and the Policy Statement released on Tuesday will garner intense scrutiny.

WHILE THE ECONOMY HAS BEEN SHOWING SOME SIGNS OF RECOVERY LATELY, MANY FOLKS STILL NEED HELP IMPROVING THEIR OWN FINANCIAL PICTURES. CHECK OUT THE MORTGAGE MARKET GUIDE VIEW ARTICLE BELOW FOR A VIDEO FEATURING FIVE WAYS TO GET OUT DEBT FASTER.

Forecast for the Week

There’s a lot of news on tap for this week, starting off right away Monday with the Empire State Index, Industrial Production and Capacity Utilization. These reports will give us a look at the manufacturing sector – and any bad news could certainly shake up the markets.

We’ll also see an update on the health of the new construction sector of the housing market, with reports on Building Permits and Housing Starts coming on Tuesday.

Perhaps the biggest news of the week will be the inflation news carried in the Producer Price Index on Wednesday and the Consumer Price Index on Thursday. As stated above and in the chart below, hints of inflation fears have the potential to negatively impact the markets – and can quickly drive Bond prices lower and home loan rates higher. The news from these reports will be even more interesting, since they come just after the Fed’s Monetary Policy and Fed Funds Rate decision on Tuesday…and many members of the Fed have lately been expressing their growing concerns about inflation. The Policy Statement following the Fed meeting is always dissected carefully – but with the rising fears of the inflation genie escaping the bottle, this Statement takes on even more significance.

Remember: Overall, weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.

As you can see in the chart below, inflation fears pushed Mortgage Bonds below two key technical levels last week…and those levels now may become “ceilings of resistance” for Bonds, making it harder for them to improve.

Chart: Fannie Mae 4.5%% Mortgage Bond (Friday Mar 12, 2010)

The Mortgage Market View…

5 Ways to Get Out of Debt Faster

Making smart choices with your money is always a good idea, but it’s especially important if you are working to become debt free. Check out this video from www.Kiplinger.com for 5 ways to get out of debt faster.

The Week’s Economic Indicator Calendar

Remember, as a general rule, weaker than expected economic data is good for rates, while positive data causes rates to rise.

Economic Calendar for the Week of March 15 – March 19
Date ET Economic Report For Estimate Actual Prior Impact
Mon. March 15 08:30 Empire State Index Mar 23.45 24.91 Moderate
Mon. March 15 09:15 Capacity Utilization Feb 72.3% 72.6% Moderate
Mon. March 15 09:15 Industrial Production Feb 0.0% 0.9% Moderate
Tue. March 16 08:30 Building Permits Feb 602K 622K Moderate
Tue. March 16 08:30 Housing Starts Feb 570K 591K Moderate
Tue. March 16 02:15 FOMC Meeting .25% .25% HIGH
Wed. March 17 10:30 Crude Inventories 3/13 NA 1.43M Moderate
Wed. March 17 08:30 Producer Price Index (PPI) Feb -0.2% 1.4% Moderate
Wed. March 17 08:30 Core Producer Price Index (PPI) Feb 0.1% 0.3% Moderate
Thu. March 18 08:30 Core Consumer Price Index (CPI) Feb 0.1% 0.2% HIGH
Thu. March 18 08:15 Consumer Price Index (CPI) Feb 0.1% 0.2% Moderate
Thu. March 18 08:30 Jobless Claims (Initial) 3/13 450K 462K Moderate
Thu. March 18 10:00 Index of Leading Econ Ind (LEI) Feb 0.2% 0.3% Low
Thu. March 18 10:00 Philadelphia Fed Index Mar 18.0 17.6 HIGH

The material contained in this newsletter is provided by a third party to real estate, financial services and other professionals only for their use and the use of their clients. The material provided is for informational and educational purposes only and should not be construed as investment and/or mortgage advice. Although the material is deemed to be accurate and reliable, we do not make any representations as to its accuracy or completeness and as a result, there is no guarantee it is not without errors.

As your trusted advisor, I am sending you the Manhattan Mortgage Company Mortgage Weekly Update because I am committed to keeping you updated on the economic events that impact interest rates and how they may affect you.

In the unlikely event that you no longer wish to receive these valuable market updates, please USE THIS LINK or email: ejarrett(at)manhattanmortgage(dotted)com

If you prefer to send your removal request by mail the address is:
Eve Robin Jarrett
Manhattan Mortgage
75 Main Street, 2nd Floor
East Hampton, NY 11937

The Manhattan Mortgage Company is the copyright owner or licensee of the content and/or information in this email, unless otherwise indicated. The Manhattan Mortgage Company does not grant to you a license to any content, features or materials in this email. You may not distribute, download, or save a copy of any of the content or screens except as otherwise provided in our Terms and Conditions of Membership, for any purpose.
For the week of Mar 15, 2010 // Vol. 8, Issue 11
Last Week in Review

“IF WE HAD NO WINTER…THE SPRING WOULD NOT BE SO PLEASANT.” 17th-Century poet Anne Bradstreet’s words ring true not only for the seasons, but also for last week’s Retail Sales numbers. Just days before Sunday’s “spring forward” into Daylight Savings Time, the retail sector looked to be unfreezing and showing at least a little spring in its step.

As you can see in the chart below, Retail Sales for February were reported last Friday at 0.3%, which was better than the previous month’s reading and much better than the -0.2% expected. Despite the good news, however, we need to keep in mind that it will be subject to future revisions – just like we saw in Friday’s report, in which last month’s decent 0.5% reading was revised sharply lower to just 0.1%.

———————–
Chart: Retail Sales (Month-Over-Month)

The better-than-expected Retail Sales was good news for the economy, but it could also lead to inflation trouble ahead. Remember, inflation is the archenemy of Bonds. Just last week, fears of inflation in China pressured Bonds around the globe. And here in the US, a number of Fed members have already mentioned inflation as an increasing concern.

And it isn’t just Fed officials who have been warning against inflation; investors around the globe are having increased doubts. Massive debt and massive balance sheet expansion – combined with near zero interest rates for a long period of time – will no doubt conjure a recipe for inflation.

The question is this: Once inflation rears its ugly head…will the Fed have the courage and the will to kill the monster by tightening policy, amidst enormous political pressure not to do so? As you’ll see in the Forecast section below, the next Fed meeting is taking place this week, and the Policy Statement released on Tuesday will garner intense scrutiny.

WHILE THE ECONOMY HAS BEEN SHOWING SOME SIGNS OF RECOVERY LATELY, MANY FOLKS STILL NEED HELP IMPROVING THEIR OWN FINANCIAL PICTURES. CHECK OUT THE MORTGAGE MARKET GUIDE VIEW ARTICLE BELOW FOR A VIDEO FEATURING FIVE WAYS TO GET OUT DEBT FASTER.

Forecast for the Week

There’s a lot of news on tap for this week, starting off right away Monday with the Empire State Index, Industrial Production and Capacity Utilization. These reports will give us a look at the manufacturing sector – and any bad news could certainly shake up the markets.

We’ll also see an update on the health of the new construction sector of the housing market, with reports on Building Permits and Housing Starts coming on Tuesday.

Perhaps the biggest news of the week will be the inflation news carried in the Producer Price Index on Wednesday and the Consumer Price Index on Thursday. As stated above and in the chart below, hints of inflation fears have the potential to negatively impact the markets – and can quickly drive Bond prices lower and home loan rates higher. The news from these reports will be even more interesting, since they come just after the Fed’s Monetary Policy and Fed Funds Rate decision on Tuesday…and many members of the Fed have lately been expressing their growing concerns about inflation. The Policy Statement following the Fed meeting is always dissected carefully – but with the rising fears of the inflation genie escaping the bottle, this Statement takes on even more significance.

Remember: Overall, weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.

As you can see in the chart below, inflation fears pushed Mortgage Bonds below two key technical levels last week…and those levels now may become “ceilings of resistance” for Bonds, making it harder for them to improve.

Chart: Fannie Mae 4.5%% Mortgage Bond (Friday Mar 12, 2010)

The Mortgage Market View…

5 Ways to Get Out of Debt Faster

Making smart choices with your money is always a good idea, but it’s especially important if you are working to become debt free. Check out this video from www.Kiplinger.com for 5 ways to get out of debt faster.

The Week’s Economic Indicator Calendar

Remember, as a general rule, weaker than expected economic data is good for rates, while positive data causes rates to rise.

Economic Calendar for the Week of March 15 – March 19
Date ET Economic Report For Estimate Actual Prior Impact
Mon. March 15 08:30 Empire State Index Mar 23.45 24.91 Moderate
Mon. March 15 09:15 Capacity Utilization Feb 72.3% 72.6% Moderate
Mon. March 15 09:15 Industrial Production Feb 0.0% 0.9% Moderate
Tue. March 16 08:30 Building Permits Feb 602K 622K Moderate
Tue. March 16 08:30 Housing Starts Feb 570K 591K Moderate
Tue. March 16 02:15 FOMC Meeting .25% .25% HIGH
Wed. March 17 10:30 Crude Inventories 3/13 NA 1.43M Moderate
Wed. March 17 08:30 Producer Price Index (PPI) Feb -0.2% 1.4% Moderate
Wed. March 17 08:30 Core Producer Price Index (PPI) Feb 0.1% 0.3% Moderate
Thu. March 18 08:30 Core Consumer Price Index (CPI) Feb 0.1% 0.2% HIGH
Thu. March 18 08:15 Consumer Price Index (CPI) Feb 0.1% 0.2% Moderate
Thu. March 18 08:30 Jobless Claims (Initial) 3/13 450K 462K Moderate
Thu. March 18 10:00 Index of Leading Econ Ind (LEI) Feb 0.2% 0.3% Low
Thu. March 18 10:00 Philadelphia Fed Index Mar 18.0 17.6 HIGH

The material contained in this newsletter is provided by a third party to real estate, financial services and other professionals only for their use and the use of their clients. The material provided is for informational and educational purposes only and should not be construed as investment and/or mortgage advice. Although the material is deemed to be accurate and reliable, we do not make any representations as to its accuracy or completeness and as a result, there is no guarantee it is not without errors.

As your trusted advisor, I am sending you the Manhattan Mortgage Company Mortgage Weekly Update because I am committed to keeping you updated on the economic events that impact interest rates and how they may affect you.

In the unlikely event that you no longer wish to receive these valuable market updates, please USE THIS LINK or email: ejarrett(at)manhattanmortgage(dotted)com

If you prefer to send your removal request by mail the address is:
Eve Robin Jarrett
Manhattan Mortgage
75 Main Street, 2nd Floor
East Hampton, NY 11937

The Manhattan Mortgage Company is the copyright owner or licensee of the content and/or information in this email, unless otherwise indicated. The Manhattan Mortgage Company does not grant to you a license to any content, features or materials in this email. You may not distribute, download, or save a copy of any of the content or screens except as otherwise provided in our Terms and Conditions of Membership, for any purpose.

For the week of Mar 15, 2010 // Vol. 8, Issue 11
Last Week in Review

“IF WE HAD NO WINTER…THE SPRING WOULD NOT BE SO PLEASANT.” 17th-Century poet Anne Bradstreet’s words ring true not only for the seasons, but also for last week’s Retail Sales numbers. Just days before Sunday’s “spring forward” into Daylight Savings Time, the retail sector looked to be unfreezing and showing at least a little spring in its step.

As you can see in the chart below, Retail Sales for February were reported last Friday at 0.3%, which was better than the previous month’s reading and much better than the -0.2% expected. Despite the good news, however, we need to keep in mind that it will be subject to future revisions – just like we saw in Friday’s report, in which last month’s decent 0.5% reading was revised sharply lower to just 0.1%.

———————–
Chart: Retail Sales (Month-Over-Month)

The better-than-expected Retail Sales was good news for the economy, but it could also lead to inflation trouble ahead. Remember, inflation is the archenemy of Bonds. Just last week, fears of inflation in China pressured Bonds around the globe. And here in the US, a number of Fed members have already mentioned inflation as an increasing concern.

And it isn’t just Fed officials who have been warning against inflation; investors around the globe are having increased doubts. Massive debt and massive balance sheet expansion – combined with near zero interest rates for a long period of time – will no doubt conjure a recipe for inflation.

The question is this: Once inflation rears its ugly head…will the Fed have the courage and the will to kill the monster by tightening policy, amidst enormous political pressure not to do so? As you’ll see in the Forecast section below, the next Fed meeting is taking place this week, and the Policy Statement released on Tuesday will garner intense scrutiny.

WHILE THE ECONOMY HAS BEEN SHOWING SOME SIGNS OF RECOVERY LATELY, MANY FOLKS STILL NEED HELP IMPROVING THEIR OWN FINANCIAL PICTURES. CHECK OUT THE MORTGAGE MARKET GUIDE VIEW ARTICLE BELOW FOR A VIDEO FEATURING FIVE WAYS TO GET OUT DEBT FASTER.

Forecast for the Week

There’s a lot of news on tap for this week, starting off right away Monday with the Empire State Index, Industrial Production and Capacity Utilization. These reports will give us a look at the manufacturing sector – and any bad news could certainly shake up the markets.

We’ll also see an update on the health of the new construction sector of the housing market, with reports on Building Permits and Housing Starts coming on Tuesday.

Perhaps the biggest news of the week will be the inflation news carried in the Producer Price Index on Wednesday and the Consumer Price Index on Thursday. As stated above and in the chart below, hints of inflation fears have the potential to negatively impact the markets – and can quickly drive Bond prices lower and home loan rates higher. The news from these reports will be even more interesting, since they come just after the Fed’s Monetary Policy and Fed Funds Rate decision on Tuesday…and many members of the Fed have lately been expressing their growing concerns about inflation. The Policy Statement following the Fed meeting is always dissected carefully – but with the rising fears of the inflation genie escaping the bottle, this Statement takes on even more significance.

Remember: Overall, weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.

As you can see in the chart below, inflation fears pushed Mortgage Bonds below two key technical levels last week…and those levels now may become “ceilings of resistance” for Bonds, making it harder for them to improve.

Chart: Fannie Mae 4.5%% Mortgage Bond (Friday Mar 12, 2010)

The Mortgage Market View…

5 Ways to Get Out of Debt Faster

Making smart choices with your money is always a good idea, but it’s especially important if you are working to become debt free. Check out this video from www.Kiplinger.com for 5 ways to get out of debt faster.

The Week’s Economic Indicator Calendar

Remember, as a general rule, weaker than expected economic data is good for rates, while positive data causes rates to rise.

Economic Calendar for the Week of March 15 – March 19
Date ET Economic Report For Estimate Actual Prior Impact
Mon. March 15 08:30 Empire State Index Mar 23.45 24.91 Moderate
Mon. March 15 09:15 Capacity Utilization Feb 72.3% 72.6% Moderate
Mon. March 15 09:15 Industrial Production Feb 0.0% 0.9% Moderate
Tue. March 16 08:30 Building Permits Feb 602K 622K Moderate
Tue. March 16 08:30 Housing Starts Feb 570K 591K Moderate
Tue. March 16 02:15 FOMC Meeting .25% .25% HIGH
Wed. March 17 10:30 Crude Inventories 3/13 NA 1.43M Moderate
Wed. March 17 08:30 Producer Price Index (PPI) Feb -0.2% 1.4% Moderate
Wed. March 17 08:30 Core Producer Price Index (PPI) Feb 0.1% 0.3% Moderate
Thu. March 18 08:30 Core Consumer Price Index (CPI) Feb 0.1% 0.2% HIGH
Thu. March 18 08:15 Consumer Price Index (CPI) Feb 0.1% 0.2% Moderate
Thu. March 18 08:30 Jobless Claims (Initial) 3/13 450K 462K Moderate
Thu. March 18 10:00 Index of Leading Econ Ind (LEI) Feb 0.2% 0.3% Low
Thu. March 18 10:00 Philadelphia Fed Index Mar 18.0 17.6 HIGH

The material contained in this newsletter is provided by a third party to real estate, financial services and other professionals only for their use and the use of their clients. The material provided is for informational and educational purposes only and should not be construed as investment and/or mortgage advice. Although the material is deemed to be accurate and reliable, we do not make any representations as to its accuracy or completeness and as a result, there is no guarantee it is not without errors.

As your trusted advisor, I am sending you the Manhattan Mortgage Company Mortgage Weekly Update because I am committed to keeping you updated on the economic events that impact interest rates and how they may affect you.

In the unlikely event that you no longer wish to receive these valuable market updates, please USE THIS LINK or email: ejarrett(at)manhattanmortgage(dotted)com

If you prefer to send your removal request by mail the address is:
Eve Robin Jarrett
Manhattan Mortgage
75 Main Street, 2nd Floor
East Hampton, NY 11937

The Manhattan Mortgage Company is the copyright owner or licensee of the content and/or information in this email, unless otherwise indicated. The Manhattan Mortgage Company does not grant to you a license to any content, features or materials in this email. You may not distribute, download, or save a copy of any of the content or screens except as otherwise provided in our Terms and Conditions of Membership, for any purpose.