The cover story covers details about the extension and expansion of the home-buying credit.

The article on the reverse side is about my academic pursuits at the University of Portland.

Enjoy!

The chart below shows mortgage rates ticking higher after hitting a low:

Watch today’s you tube video for details on what he said.

Click this link to view Fed Chairman Bernanke’s Op-ed piece in this morning’s WSJ.

Current Outlook: floating

For the last week we’ve been stressing the importance of the financial sector during this 2nd-quarter earnings season.  On Tuesday Goldman Sachs reported better than expected earnings which pushed rates higher.  This morning JP Morgan reported better than expected earnings but also warned against larger loan losses in the second half of the year.  These comments are hurting financial stocks which is part of the reason mortgage rates recovered from yesterday afternoon’s increase.  Tomorrow Citigroup and Bank of America report earnings.

In other financial news lender CIT has announced that unless it can raise $2 billion in additional capital it will be forced to file for bankruptcy in the next 24 hours.  If this were to happen it would be another blow to the economy as CIT is a major lender to thousands of small businesses across the nation.  It is unclear whether the market fully understands the impact of this announcement.

With the poor outlook given by JP Morgan and the CIT news we are going to shift into a floating position.  I believe Citi & B of A will also warn against upcoming loan losses which will dampen the outlook for stocks; helping to push mortgage rates lower.

Current Outlook: floating

Although mortgage-backed bond prices declined yesterday afternoon threatening to push mortgage rates higher; they have rallied this morning on weaker than expected consumer confidence figures.

Early on in 2nd-quarter earnings season there hasn’t been too many surprises.  The bulk of reports will begin to roll out next week and we still believe this is the most important story to follow.  We’ll keep you posted.

Current Outlook: bias towards locking

Mortgage rates are essentially unchanged this morning despite an economic storyline that would typically help rates move lower.

Equity markets around the world traded lower today as investors pull back on stocks ahead of earnings season which kicks off on Wednesday.  The US Dollar is trading higher against foreign currencies and oil prices are lower.  This inflation-easing news has yet to help mortgage rates because of technical trading patterns.

We’ll keep a close eye on the market over the next couple days to see if bond prices can break through the 50-day moving average.  If they can, expect lower mortgage rates later in the week.  However, we’re taking a risk because it’s also very possible for bond prices to bounce lower here which would push rates higher.

Current Outlook: Cautiously floating