Another increase in rates today but the rate-setters for the mortgage companies have to be a bit gun-shy, and as a result, there is probably at least an 1/8 of a point priced in. Once we get past the Fed meeting that’s underway and Trump’s State of the Union tomorrow, things might settle down. The mortgage guys aren’t as optimistic:
From a week and a half ago, most borrowers are now looking at another eighth of a percentage point higher in rate. In total, rates are up the better part of half a point since December 15th.
This marks the only time rates have risen this much without having been at long term lows in the past year. For example, late 2010, mid-2013, mid-2015, and late 2016 all saw sharper increases in rates overall, but each of those moves happened only 1-3 months after a long term rate low.
The current trend continues to offer false hope with potential ceilings that are quickly broken. Rates have then had a challenging time getting back below those levels. This is classic behavior for these sorts of big, serious market movements and part of the reason we’ve continued to advocate a defensive stance despite periodic victories. Such victories are bound to occur in any interest rate environment.
We need to see bigger victories and more of them if it’s going to make any sort of sense to be anything other than defensive when approaching the current interest rate landscape. Lock early and plan on rates moving higher until we see a broad shift in momentum.
Link to MND
The name of the game is reinvigorating the middle-class.
After Dodd-Frank, small banking was ham-strung, and the middle-class was no longer properly served, which put them in the morass of people trying to find a job, instead of creating, and innovating.
My parent’s wealth was based on a small bank loan, when no other bank would talk to them. Without the small bank loan, my parents would have been workers for somebody else with deep pockets, and all the employee’s my parnets hired, wouldn’t have been hired, since my parents wouldn’t have been there to hire them, and the economy would have reflected that: Kind of a sad economic morass of the poor, desperate worker bee’s, then the economic outlier’s and the rich. Like we’ve had for the last eight years.
Linked below, from 2016, is a perfect description of what used to be, by the founder of Home Depot. With the current apparent economic shift to production, we’re getting back on track to the basics, and that’s good, since there’s stormy weather ahead.
Production cuts the bullsh*t.
If that’s the ONLY thing Trump understands, that’s PLENTY!
As far as real estate investment, imo, hard assets will be king for a while. There’s gonna be a lot of drama ahead. World markets will be in flux all year and it’s reverberation will affect us.
imo, if you see a house you like, that can afford, just buy it. It’s security. It’s worth it.
If your investment is not connected to hard assets or measurable production, you’re speculating in a house of mirrors. You can win at that, but… if you don’t… don’t cry.
https://www.youtube.com/watch?v=gGLf1e-46SQ