[Roy]

On CBS Marketwatch today:

[url=http://www.marketwatch.com/news/newsfinder/pulseone.asp?siteid=mktw&guid={ABB9F89C-C02C-42B1-AD15-6B5031E97847}&dist=bnb]Article[/url]


10:47am 04/07/05

$this->bbcode_second_pass_quote('', '1')0:47am 04/07/05

U.S. mortgage rates fall; 30-year under 6% (FRE) By Steve Kerch
CHICAGO (MarketWatch) -- U.S. mortgage rates fell in the week ending Thursday with the benchmark 30-year loan dropping below 6 percent, Freddie Mac said in its weekly survey. The mortgage agency (FRE) said the national average interest rate on the 30-year mortgage was 5.93%, down from 6.04% a week earlier. Average rates on the 15-year, 5-year hybrid and one-year adjustable-rate mortgage also fell.

[MonteQuest]

$this->bbcode_second_pass_quote('Roy', 'O')n CBS Marketwatch today:

[url=http://www.marketwatch.com/news/newsfinder/pulseone.asp?siteid=mktw&guid={ABB9F89C-C02C-42B1-AD15-6B5031E97847}&dist=bnb]Article[/url]


10:47am 04/07/05

$this->bbcode_second_pass_quote('', '1')0:47am 04/07/05

U.S. mortgage rates fall; 30-year under 6% (FRE) By Steve Kerch
CHICAGO (MarketWatch) -- U.S. mortgage rates fell in the week ending Thursday with the benchmark 30-year loan dropping below 6 percent, Freddie Mac said in its weekly survey. The mortgage agency (FRE) said the national average interest rate on the 30-year mortgage was 5.93%, down from 6.04% a week earlier. Average rates on the 15-year, 5-year hybrid and one-year adjustable-rate mortgage also fell.

[RonMN]

The only way interest rates could drop at this point, would be a huge slow-down in people taking a mortguage/refinancing.

[marek]

Since the Fed has been raising interest rates, the fact that mortgage rates have fallen suggests that the demand for new mortgages might be decreasing. It could be the first symptom of the housing bubble bursting, but who knows.

[RonMN]

I didn't wanna mention the housing bubble bursting but it IS a possibility

[EnemyCombatant]

I thought there was inflation concerns.

If the Fed has to decrease interest rates despite signs of inflation, this is evident of the conundrum.

They are stuck between a rock and a hard place.

[RonMN]

Ouch!

[wisegoat]

what is a bubble anyways?

[MonteQuest]

$this->bbcode_second_pass_quote('wisegoat', 'w')hat is a bubble anyways?

[hull3551]

I think there is definitely an oversupply of lenders out there. Everybody was getting into re-fi’s a ways back. I was told there was ‘A Paper’ – the best - down to B, C, and even D Paper. All those can re-fi have done so, and now the increased competition looms as those pools of buyers begin to dry up. Consequently, reduced margins for the lenders translates into lower mortgage rates.

I’ve read there will probably not be a rate increase in the fed funds for a while, as the economy is stagnating.

[Carrie]

It appears that the housing bubble is starting to pop:

$this->bbcode_second_pass_quote('', 'I')n what could be a crack in the housing market's sturdy foundation, the number of foreclosed homes put up for sale rose 50 percent between February and March, according to a new study by Foreclosure.com.

The increase is one of the biggest monthly spikes Foreclosure.com has seen since it began tracking the market in 1999, according to Jim Houston, vice president of the foreclosure listing service.

[RdSnt]

$this->bbcode_second_pass_quote('Carrie', 'I')t appears that the housing bubble is starting to pop:

$this->bbcode_second_pass_quote('', 'I')n what could be a crack in the housing market's sturdy foundation, the number of foreclosed homes put up for sale rose 50 percent between February and March, according to a new study by Foreclosure.com.

The increase is one of the biggest monthly spikes Foreclosure.com has seen since it began tracking the market in 1999, according to Jim Houston, vice president of the foreclosure listing service.

[ernest]

Any of you guys study Economics?

The long term mortgage rates, at around 6%, are substantially higher than they were six months ago. As with oil prices, a slight down ward movement does not mean it is a trend. The long term trend will follow short term rates.

Given that, there is tremendous pressure on lenders to keep the rates low and lend money. It is the last bit of liquidity keeping the economy "booming". When mortgage rates go up another point ( this year or next year), the housing boom will be over and home prices will start to drop ( unless, of course, the huge liquidity created by the cheap money of the last four years has inflated all asset classes).

Meaning that there is a housing bubble, but cheap money has created so much liquidity that inflation probably will show itself in all classes soon.

Right now stocks are extremely pricey and there is no real value there. Bonds are pricey, even crap junk bonds are not yielding much. Unbelievable......

[threadbear]

The plan to bomb the crap out of Iran this summer, will have the effect of paralyzing any oil producing nation from trading oil for euros, or any other currency. This will keep the dollar solidly backed by oil and guns, and might prevent it from dropping off a cliff. It's still headed down in a big way, but might survive as a means of exchange, domestically, and retain some kind of fear factor standing, internationally.

The abilityof the fed to set interest rates is restricted to a narrow band, somewhere between 2.5 and around 4.00 %. If it goes much above 4% the derivatives tower starts to fall. If it goes below a certain point, of course the dollar will drop like a rock.