November 30, 2012 by Leave a comment

Mortgage rates ended up improving slightly yesterday after bouncing around throughout the day.  Mortgage backed securities are rallying again this morning, but it’s really anyone’s guess as to whether this rally will hold up.  Day-to-day swings aside, I don’t envision a circumstance where rates rise significantly before the end of the year.  Between the fiscal cliff, Europe, and the shaky U.S. economy there is simply too much lingering uncertainty for rates to break out of the range they’ve been in for several months.  When we start getting some concrete information on how the trumped up fiscal cliff problem will be solved this may change, but until then…

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I want to touch on the fiscal cliff just briefly to say that I think it is asinine that financial markets have been swinging around all week on the basis of rumors and political talking points.  I don’t know how anyone can possibly believe anything that GOP/Dem leaders are saying publicly right now.  It’s all bluster and political posturing, yet we’ve seen the markets (seemingly) pivot a couple times this week on vague statements about the negotiations.  The utter inanity of this whole thing is stupefying.  The crux of the issue is this: failure to address the fiscal cliff will result in higher taxes, spending cuts, and a drag on growth next year.  A resolution of the issue will probably result in higher taxes, spending cuts, and a drag on growth next year.  Notice the similarity?  Of course this is simplistic, but that’s it in a nutshell – it’s only a question of how the resolution is structured, and how much of a drag will be created.

Today’s economic data is a mixed bag (again).  Personal income was flat on the month while consumer spending dipped by 0.2%.  Both of these numbers are somewhat lower than expectations, and both of them may have been impacted by the hurricane, but nobody seems to know how great the hurricane-related distortion is.  This report will probably have a minimal impact on the markets and rates.

While I don’t see the current rate environment changing greatly in the near future, I would still advocate that anyone looking for a mortgage try to take advantage of near-record low rates sooner rather than later.  Rates have a tendency to spike when they rise, and there is no way to know if or when that will happen.  Fair warning.

Have a great weekend!

Today’s Links:

Fangraphs: Marvin Miller’s Legacy, and the Decline of Labor.

Bloomberg: Foreclosure Wave Averted as Doomsayers Defied: Mortgages.  We shall see…

Credit Slips: Where Are the Foreclosures?

Reuters: Greeks Rage Against Pension Calamity.

Guardian: Eurozone Unemployment Record High Hits Young People Hardest. 55% unemployment amongst Greek and Spanish youths!

Reuters: Euro Zone Set For Recovery in Second-Half of 2013: Draghi. I’ll take some of whatever Mario’s drinking…

Scientific American: Supersymmetry Fails Test, Forcing Physics to Seek New Ideas.

Guardian: Court Blocks Release of Greek Accounts.  God forbid we know which entities caused the current crisis.  For now we’ll just have to strongly suspect.

Charlie Pierce: The Pirates Behind the Campaign to Fix the Debt.  “The real reason we should stop talking about [the debt] for a while is that the people who are insisting that it will eat us and our posterity on toast are lying swine who would sell your white-haired granny to the Somali pirates for another three points on the Dow.”  Amen, Charlie.

Tim Duy: A Little Less Dovish.

Slate: Kurt Vonnegut’s Rules For Reading Fiction.

Michale Yingling:  This is a Calvin and Hobbes search engine.  It is awesome.

Pat Oliphant: On the mortgage deduction.

Washington Post: More Than 25,000 Missing in Mexico.  Let’s not forget the root causes of the war in Mexico.  See next link.

David Simon: A Fight to the Last Mexican.

Total Mortgage offers some of the lowest mortgage rates and fastest closing times of anyone in the mortgage industry.  Refinancing your home loan today could slash your monthly payments.  Call us now at 877-868-2503 in order to speak with one of our licensed loan officers.    

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