While the Fed and the Obama administration insist that recovery is moving forward, the pattern of inbound data produces the same, queasy sensation as their denial in the fall of 2007 and the summer of 2008.

New unemployment insurance claims hit a one-year high, to 500,000 last week. There was no dramatic spike, just steady deterioration. The Philadelphia Fed index yesterday stunned the remaining optimists: Expected to rise from a weak 5.1 in June, it fell to negative 7.7, weakest in new-order and employment components.

The definitive 10-year T-note broke last weekend from the 2.7 range to 2.59 percent, and is still hovering there, but mortgages are under upward pressure from refinance volume that doubled since April, and from the Fed’s halt in buying mortgage-backed securities — it is buying Treasurys now. Purchase applications are dead flat.

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