AgentIndustry News

Financial markets size up new Fed chief

Interest rates, inflation become hot button

The real estate event of the summer
Connect with other top producing agents at Connect SF, Aug 7-11, 2017

Rates rose last week, the 10-year T-note reaching 4.6 percent at one point, taking low-fee mortgages to 6.25 percent. (Friday's newspaper headlines, "Mortgages To New High", refer to Freddie Mac's lagged-survey discovery of 6.15 percent more than a week ago.) I assume that mortgages will continue to rise during the Fed's coming progression: another .25 percent on Tuesday (to a 4 percent overnight cost of money, 7 percent prime), another .25 percent on Dec. 13, and another on Feb. 1 – unless the economy croaks in the meantime. Economic data are still hurricane-garbled, except for home sales, which seem authentically strong. Third-quarter GDP gained a terrific 3.8 percent, but the September one-third of the quarter is just a pleasant guess. Durable goods orders fell hard in September, but there is no way to know if the decline was real or storm-distorted. Core inflation numbers in the GDP report were benign, but nobody knows if the Fed should be watching core numbers or the vast...