AgentIndustry News

Hope for a ‘decline in the rate of decline’

Future-Proof: Navigate Threats, Seize Opportunities at ICNY 2018 | Jan 22-26 at the Marriott Marquis, Times Square, New York

The Fed's outright purchases of agency mortgage-backed securities -- bonds guaranteed by government-sponsored entities such as Fannie Mae or Freddie Mac -- are having the desired effect: Rates are down and staying down. Even the Fed's immense power cannot force rates to 4.5 percent or lower (not quickly), but it has removed upside volatility. Mortgage rates should have run back way above 5 percent in a week like this -- a big bear-market stock rally and immense refinance demand -- and instead held near 4.75 percent. The chatter all week long, especially among the stock-happy adolescents at CNBC: Bottoming is in process, and the worst is over. In the "blogocracy," doom is predominant: The credit fixes and stimulus either won't work in time or were the wrong things to try. Reality is in the middle somewhere. The thing to hope for is decline in the rate of decline (yeah, we're in that much trouble). Housing first. Mortgage rates are down, which should stimulate consu...