AgentIndustry News

Fed pause likely next week

Mortgage market commentary

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Long term rates stabilized this week, near 4.8 percent for the 10-year T-note holding low-fee fixed-rate mortgages at 6.375 percent. Stability is likely to persist for another week. The Fed meets next Tuesday, but two weeks before election day will keep the lowest-possible profile, and there is no significant economic data due until the first days of November. Last week and this, rates have been a bit higher than at the end of September on the theory that the economy is in pretty good shape, the Fed focused on inflation worry and not thinking at all about a rate reduction. The all-OK thinking is brought to you by the same guys who have been howling, "Housing Bubble!" They have now decided that the worst is over for housing, and a soft landing is in process. This switch in outlook is a perfect example of the error in the bubble theory in the first place, and illustrates crucial differences between financial markets and real estate. The all-OK discovery began by misunderstanding confusi...