The Fed gave the bond market what the “experts” expected and they didn’t like it.  The Fed’s announcement today to hold steady on interest rates through 2014, was exactly what all the investors forecast.  And the bellwether 10 year treasury bond rose from 1.96% to over 2%.  The disappointment is most likely from the Fed not supplying any clues as to their future intentions.  Such is the state of the markets today – little logic.  That will keep mortgage rates in the 4% range.

Mark Zandi, Chief Economist for Moodys, announced in a phone interview with Bloomberg that: “The crash is over, home sales -- both new and existing -- and housing starts are now off the bottom.”   He quoted yesterday’s reports of better than expected new home sales and a slowdown in resale home price drops as the basis for his comments.  Although home values dropped 3.5% in February in 20 US cities survey, it was the smallest drop in a year.  It's interesting that a slow down in the drop of prices is now considered a recovery.  Does that work with stocks also? If the price isn’t dropping as fast, I’m making money?!

Today’s durable goods orders report showed troubling signs for the economy dropping 4.2%, the largest drop in 3 years... That is a sign of a dramatically slowing economy.  This should have been better for interest rates than the Fed’s silence but…..

There will not be a report on Friday as I’m taking a few days off.  We’ll talk next week.  Be well.

Jed Marquis
Premier Lending, LLC
"There's More to a Mortgage than the Payment!"
Direct 720 833-7964
Cell 303 885-1532
Fax  303 484-4472
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