September 2012

Found 14 blog entries for September 2012.

30 year 3.25%  * 15 year 2.75%

Lots of financial news for the week’s end, little of it good for the economy and most all of it good for interest rates.  Much of the bond market’s focus though has been on the Spain Bank stress test. 

So what’s happened?  The Durable Goods report came out and it is dismal. New orders for July were revised down from 4.2% to 3.3% and August, while expected to be down 5% was actually down a whopping 13.2%.  Even with big ticket transportation removed, the prior report went from -0.4% to -1.3%.  Transportation numbers fell 34.9% after a 13.1% gain in July.  Civilian aircraft orders which haven’t been doing well to start with,  fell an unbelievable 101.8%.  I guess the one order from last month must have cancelled.

GDP,

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Things have improved since Friday and mortgages are following suite.  The 10 year treasury has dropped from Friday’s 1.75% reading to 1.62% on the basis of…. not much.  The economic reports at home have been mostly minor and the strongest factor in the drop  is another report on consumer confidence showing consumers are far more optimistic than projected.  Last month’s 60.6 reading was improved to 61.3 and the consensus range for this month was 61.5-68.  Yesterday’s report came in at a startling 70.3.  This is following last week’s Gallup report and tends to show that there is more in play than Gallup’s report of euphoria over the speeches at the Democratic convention.  This is the third best reading of the recovery and best since February.

Europe and

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30 year = 3.5%, 15 year = 3.125%

The markets decided to prove us correct this week.  On Wednesday, we said to expect nothing in the area of rate movements and that’s exactly what we’ve seen – nothing.  While there were a number of not important reports published, the only report of any consequence was the weekly unemployment report which showed that we had 382,000 people file first time unemployment claims last week.  The consensus was only 373,000.  Last week’s numbers were revised upwards by 3,000 to 385,000. Normally with a miss of 9,000 from consensus coupled with an upward revision,  we would see stronger movement from the 10 year treasury yield.  This week we’ve only seen a 4 BP drop.  That’s a very minor drop at best.  In the wake of Tropical

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The euphoria from the convention is fading (see Friday Financials for 9/14), there are a couple economic reports with numbers around expectations and mortgage rates are back down to 3.5% for the 30 year.  The 10 year treasury dipped back down from Friday’s high of 1.87% ending today at 1.77%.  The two reports of note, showed housing permits and housing starts coming in about at consensus – one a little better, one a little worse and existing home sales came in 270,000 above expectations and had the strongest showing since May of 2010.  But the sale prices are still dropping with median prices down 0.2% for the month.  Cash transactions account for 27% of the volume and distressed sales 22%.

Two pieces of interesting information:  A group of powerful

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30 year  3.625% ~ 15 year 3.375%

Upward pressure is mounting and starting to affect mortgage rates.  The 30 year fixed mortgage rate has been holding onto 3.5%, today they finally caved in and moved solidly to 3.625% with 3.75% on the near horizon.  The spread between 30 year and 15 year mortgages shrank dramatically as the spread, which had been pretty consistent at .5 - .625% difference, shrank to .25%.  The question is; do the economic facts support these changes? Or does it matter?

The 10 year treasury jumped to its highest levels since mid-May, 1.86%  on a large mixed bag of reports but the markets seemingly focused on the highly speculative Consumer Sentiment report to fuel the jump.  The usually minor Consumer Sentiment Report showed a large

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Lisa Wade has been in the real estate business for 20 years, and has been with RE/MAX of Boulder for 16 of those years. Lisa had been in the health club business, and her husband was in the landscaping business. He decided that he would get his real estate license to go into property management, so Lisa decided to join him. When they finally got their license, they decided property management might not be for them and Lisa decided to start helping people buy and sell homes.

 Lisa grew up in Boulder and from of her previous job had a large sphere of influence right from the start. She is currently on the Board of Directors for the Boulder Area Real Estate Association. She served on it in the late 90’s and has been active with BARA ever since.

To

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Not a good start to the week as the 10 year T-Bill rose to its highest level since mid-August.  Friday we bottomed out at 1.58%, and this afternoon we’re sitting at 1.76%.  There are a variety of “sort of” issues and reports but the bottom line is the 10 year treasury auction this morning didn’t go well.  Demand was low as was the number of bidders for the $21 billion in bonds.  Too much supply plus not enough demand equals lower prices (higher rates) to get it sold.  The good news is that mortgage rates are hanging onto 3.5% for a thirty year and 2.875% for a 15 year. 

Most of the current focus is back on technical moves in Europe which are seemingly positive but far from clear.  The US International trade deficit came in better than consensus and

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All Chad Hamby has done in his adult life is install fences and decks.

Chad & Marissa Hamby

“I’ve been doing it since I was 19 years old,” he says. “I went straight into the work force (from high school).” After six years of working for someone else, Chad started his own business in 2000 – when he was only 25 years old.

And that’s impressive when you consider his business, Alpha Fencing LLC – soon to be Alpha Fencing and Deck LLC – has survived one of the biggest economic recessions the nation has ever seen. It continues to withstand the economic uncertainty that has succeeded the recession.

It’s even more impressive when you consider the business has remained without the use of a website, relying on Angie’s List and the old-fashioned phone book and referrals for

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Boulder County area markets posted yet another month of year-over-year increases in both single-family and attached-unit sales in July, though they are showing signs of premature slowing.


July’s 422 single-family sales represented a 26.3 percent increase over the 334 single-family sales in July 2011, and the 149 condo/townhome sales equaled a nearly 45 percent jump over the 103 sales of attached dwellings a year ago.


“It’s actually very positive,” says Ken Hotard, senior vice president of public affairs for the Boulder Area Realtor Association.


However, the change compared with June was much less impressive, with single-family sales actually dropping 14.9 percent.


“That really sort of signals the seasonal slowdown in activity, which I think is

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15 year fixed rate 2.75%, 30 year 3.5%

Quite a roller coaster the last 24 hours.  Yesterday saw rates shoot up as new unemployment claims came in at the very low end of expectations, 365,000. Conversely we saw last week’s numbers revised up by 4,000 and the four week moving average climb to 371,250.  Those numbers alone shouldn’t move the market much as they net out to a very slight improvement.  But two factors came into play:
First the ADP jobs report, a notoriously inaccurate  monthly precursor to today’s employment report, came out considerably stronger than any expectation.  The consensus for ADP was that we had created 149,000 jobs last month.  The ADP report showed 201,000 jobs created.  That number of job creation would be a huge boost for the

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