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View Diary: Housing: A Picture is Worth 1000 Words UPDATE (241 comments)

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  •  Cheap Money, Cheap Money (4+ / 0-)
    Recommended by:
    coral, bobinson, chillindame, CAL11 voter

    Get your money here. The Fed hasn't dropped the cost of short-term money, but long-term money is on sale.

    • 30-year mortgages are at 5.86%, they were at 6.4% three months ago.
    • 15-year mortgages are at 5.57%, they were at 6.1% three months ago.
    • 30-year Treasuries are yielding 4.76%, three months ago they were yielding 5.27%
    • 10-year Treasuries are yielding 4.62%, three months ago they were yielding 5.24%

    This is not the face of a strong economy. As The Wall Street Journal said today:

    With the economy showing signs of a sharper than expected softening and Fed policy on hold, the 10-year note yield could move back toward a range of 4.50% to 4.60%, said John Canavan, economist at Stone & McCarthy.

    ...

    Trading has been "all in the same direction -- everyone has been selling," Mr. Crawford said. Investors know that the average lives of mortgage bonds are going to be shorter with Treasury yields -- and by extension, mortgage rates -- headed lower, he added.

    Democrats: Giving you a government that works.

    by freelunch on Fri Sep 22, 2006 at 06:10:19 AM PDT

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