AgentIndustry News

Americans may need to go on ‘borrowing diet’

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Mortgage rates fell a little this week, back down to 5.625 percent, assisted by some not-so-hot economic data, a non-threatening performance by Alan Greenspan, and massive buying of bonds by foreign central banks. The data weren't awful, but also were not consistent with a quickening economy. New claims for unemployment benefits have stabilized at 350,000 each week, retail sales grew less than 1 percent last month, and in a surprise this morning, the University of Michigan mid-month measure of consumer confidence fell hard, down 10 points to 93.1, wiping out all the gains going back to last fall. Early this week, rates rose in fearful anticipation of Greenspan's semiannual testimony on monetary policy to Congress. Specifically, would the Fed's new "patient" attitude have a shorter fuse than the prior "considerable period"? We need not have worried – the fuse isn't lit, and Greenspan hasn't even reached for a match. He gave us the obligatory "...the real federal funds rate will...