Good Afternoon,
I hope that this note finds you well. Belated Happy Mother's Day to those in this audience qualifying for it :)
In the financial sector today, Mortgage Bonds were off to a good start this morning at the expense of Stocks being sold off. This morning's market activity was being fueled by reports that many banks are taking action to repay TARP funds back to the government. While this can be looked at as a healthy sign for the economy, the way the banks are raising capital is by selling newly created shares of company Stock, which is a bad thing for the short-term financial situation of Stocks.
Stocks in general may certainly need a breather after the very sharp 30% plus rise over the past couple of months. I'm certain many of you may have noticed this in your portfolios, if you have the courage to look at them. Some of the euphoria surrounding some recent economic reports may be overdone as the unemployment rate may be as high as 15% when individuals who have to settle for part time employment are considered. And, last Friday’s job number could also be subject to future downward revisions.
I recommend floating mortgage rates for now with the flow of money out of Stocks and into Bonds, but I will watch closely for any change in the market, and I will certainly keep you posted should a change in position be necessary.
In the meantime, I hope you enjoy the rest of your Monday and have a fabulous week ahead! If there is ever anything that I can do for you, please let me know.
PS Are you following me on Twitter? @MortgageMinute is where you will find me there.
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