Philip Jensen's Mortgage Blog

A Gross Domestic Product

noreply@blogger.com (Philip Jensen) — Mon, 30 Jan 2012 20:45:00 +0000

Last Week in Review: The Fe d met and a Gross Domestic Product was reported.

Forecast for the Week:A busy week is ahead, with important news on inflation, manufacturing, and the job market.

View: Ever wondered what the world was really like when you were born? Theres a fun way to find out.

Last Week in Review

If at first you don't succeed, try, try again. Last week, that popular idiom could have applied to the Gross Domestic Product (GDP) Report. Read on to learn why...and how all the week's news impacted Bonds and home loan rates.

The Advanced GDP reading - or first of three readings - for the 4 th Quarter of 2011 came in at 2.8%, a bit below expectations of 3.2%. This number will be revised two more times, but if the final GDP remains at 2.8%...then the overall GDP for 2011 would be a scanty 1.57%. That is certainly a "Gross" Domestic Product, when you consider that the government has underwritten more than half of that economic growth with the Payroll Tax benefit.

Also in the news last week, the Fed's Policy Statement after its regularly scheduled Federal Open Market Committee meeting was pretty much the same story as recent Statements, including stable long-term inflation expectations, a tepid economic recovery, and fragile job market. But there was one big exception to their norm. The Policy Statement said there will be "exceptionally low levels for the Federal Funds Rate at least through late 2014." This is a huge change from the previous statements of "low rates until mid-2013."

On the surface, extending the zero interest policy until 2015 tells us the Fed thinks the economy will just be slogging along, and accommodative monetary policy will be required to keep the economy growing at least at a modest pace. One could argue that recent economic data is better of late and that all this loose monetary policy is unnecessary. But the Fed has spoken, and as the old adage goes: "Don't fight the Fed."

In news out of Europe, yields in European Bonds have come downand by quite a bit. This sparked some optimism that Europe's Long-term Refinance Operation (LTRO) has helped alleviate some pressure in the peripheral countries in the Eurozone, like Spain and Italy. So what's the takeaway? In honor of the upcoming Super Bowl, here's a football analogy: think of the LTRO as a super punt or "kick of the can" down the road. Europe needs to play a serious offensive line by creating a tighter fiscal union, implementing au sterity measures, and developing growth strategies to help pay down the enormous debt.

Refinance numbers are expected to increase dramatically over the next numbers of months due to the new HARP Refinance Programs kick off. Arizona Harp Lenders are expected to see the greatest share of these loan requests as the market there has witnessed it’s home values drop extensively.

The bottom line is that Bonds and home loan rates remain at historic best levels, which means now is still a great time to purchase or refinance a home. Let me know if I can answer any questions at all for you or your clients.

Forecast for the Week

Economic reports will be plentiful - and important - this week:

The week kicks off Monday with the Core Personal Consumption Expenditure (PCE), which is the Fed's favored gauge of inflation. This report will be closely watched, since any hint of an uptick in inflation could push Bond prices lower and, in turn, move home loan rates higher.
Manufacturing will also be in the spotlight with the Chicago PMI on Tuesday, followed by the ISM Index on Wednesday.
Consumer Confidence will also be delivered on Tuesday.
The ADP Private Employment Report will be released on Wednesday and comes before the government's total job's report on Friday.
As usual, Initial Jobless Claims will be released on Thursday. This week's report comes after an uptick of 21,000 last week.
Finally, on Friday the government's monthly Employment Report will be released. The Employment Report consists of Non-farm Payrolls, the Unemployment Rate, Average Workweek and Hourly Earnings. This is an important report that can have a big impact on the markets. So I'll be watching it closely.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.

As you can see in the chart below, Bonds and home loan rates remain near their historic bests. I'll be watching closely to see which way they move next.

Chart: Fannie Mae 3.5% Mortgage Bond (Friday Jan 27, 2012)

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Mortgage Update

noreply@blogger.com (Philip Jensen) — Tue, 22 Nov 2011 17:58:00 +0000

Last Week in Review: There was more negative news out of Europe and some positive economic news here in the US. But how did home loan rates fare and what affect may it have on the new HARP Loan Program?

Forecast for the Week: There will be plenty of news to gobble up before the Thanksgiving holiday, with reports on the housing market, the state of the economy, inflation, consumer sentiment, and more.

View: Planning to do some shopping on Black Friday? Be sure to check out these tips first.

Last Week in Review

They say it takes two to tango.... And Stocks and Bonds continue to battle for investing dollars and trade in seesaw fashion. What's causing this dance in the markets? Read on for details.

First, there was more pessimistic news out of Europe last week, as German leader Angela Merkel said that Europe is going through its toughest times since World War II, plagued by political unrest and a severe debt crisis. Reports showed there was a slowing in manufacturing to the point where recession fears have now gripped Europe.

Here lies another enormous problem for Europe: One way--and probably the biggest way--to lower government deficits, is to grow your way out and elevate Gross Domestic Product (GDP). However, many of the Southern Europe economies are on the brink of recession, which will make lowering the deficit through economic growth impossible.

So what does all of this mean for home loan rates here in the United States?

The problems in Europe should continue to support the US Dollar and US Bonds (including Mortgage Bonds, on which home loan rates are based) to some degree, as investors will view our Bonds as a safe haven for their money. Yet, if we continue to see better-than-expected economic data here like we did last week, this will offset the continued uncertainty surrounding the European crisis. And this is part of the reason that the Bond markets and home loan rates saw limited gains last week.

Some of the good news last week included tamer than expected wholesale inflation in the form of the Producer Price Index (PPI) and improved New York Manufacturing. Also, as you can see from the chart, the year-over-year headline Consumer Price Index (CPI) was down from the previous reading, which is good news for people concerned about inflation. However, the closely watched Core CPI rose by 0.1%, and though this was inline with estimates, it did push the year-over-year rate to 2.1% from 2%...a touch above the Fed's comfort zone.

The bottom line is that home loan rates are still near historic lows, which means now remains a great time to purchase or refinance a home. Let me know if I can answer any questions at all for you or your clients.

Forecast for the Week

This Thursday, all capital markets will be closed in observance of Thanksgiving, and Friday will be a shortened session. But we'll still see a cornucopia of economic indicators reported in just three days:

Existing Home Sales will be released on Monday. The report comes after last week's positive reports on Housing Starts and Building Permits, which signaled a glimmer of hope to the battered housing sector.
The second read on Gross Domestic Product (GDP) for the 3rd Quarter will be delivered on Tuesday. The initial reading showed a somewhat healthy 2.5% increase. Also, look for the Durable Goods Report on Wednesday, which gives us a read on big-ticket items and a sense of how the economy is doing.
The Consumer Sentiment Index will be released on Wednesday just in time for traders to square up positions ahead of the long holiday weekend.
Also released on Wednesday will be the Fed's favorite gauge on inflation, the Core Personal Consumption Expenditure, as well as Personal Incomes and Spending.
Finally, this week Initial Jobless Claims will be delivered on Wednesday rather than Thursday due to the Thanksgiving holiday. Claims have been below 400,000 for the previous three weeks, signaling that there may be a light at the end of the tunnel in the Labor markets.
HARP Refinance activity has began to pick up as inquiries to lenders and HARP Loan Program information sites have seen a quick rise in requests for information.

In addition to those reports, the Fed's Federal Open Market Committee meeting minutes from November 2nd could have some surprises when released at 2 pm ET on Tuesday. Last week, the New York Fed leader William Dudley said that it would make sense for the Fed to begin purchasing Mortgage Backed Securities. The minutes could reveal if the members discussed the topic.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.

As you can see in the chart below, the problems in Europe tempered the impact that strong economic news in the US had on Bonds and home loan rates. This dynamic will be something to watch closely in the weeks ahead.

Chart: Fannie Mae 3.5% Mortgage Bond (Friday Nov 18, 2011)

The Mortgage Market Guide View...

For more information on the Mortgage market and the HARP refinance loan program look for next week’s issue.

Economic Calendar for the Week of November 21 - November 25

Date	ET	Economic Report	For	Estimate	Actual	Prior	Impact
Mon. November 21	10:00	Existing Home Sales	Oct	4.85M		4.91M	Moderate

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What is HARP Conventional Streamline Refinance and Market Info

noreply@blogger.com (Philip Jensen) — Tue, 01 Nov 2011 20:16:00 +0000

Phil Jensen

Mortgage Director

AmeriFirst Financial

Phone: 602-492-8393

Phil@JensenTeam.com

Best Arizona Home Search

Arizona Home Loans

HARP Program

In This Issue

Last Week in Review: Historic news out of Europe, plus Stocks make history.

Forecast for the Week: The Fed meets, and Friday brings big Job news-will the numbers give the markets a scare?

View: Changes are coming to the Home Affordable Refinance Program. Find out what this means for homeowners.

Last Week in Review

Trick or treat? Last week, there was big news out of Europe, as an agreement was reached to help keep Greece from going into default. But will this deal mean a frightful time is ahead for Bonds and home loan rates? Read on for more details.

On Thursday, the world was cheering on the news that a deal in Europe was reached, with private banks and other holders of Greek debt accepting a 50% haircut on their principal investment. Once the write down takes place, Banks who are holding Greek debt will have to recapitalize themselves by year-end, and government support will be available to fill voids that private money won't fill. In addition, the Economic Financial Stability Facility (EFSF) rescue fund, which currently has $443 Billion in holdings, will be expanded and leveraged to $1 Trillion Euros or $1.4 Trillion US Dollars.

So the agreement is together…but like any effective plan, it now has to be put into action. And as this rolls out, the financial markets will be watching every step. When the sentiment is positive, like it was the day the plan was announced, Stock markets could benefit as investors would seek to take advantage of gains.

In fact, the Stock markets are set to have their biggest monthly gains on record as October comes to an end. The closely watched S&P 500 Index is up 13.5% for the largest increase since October of 1974, while the Dow Jones advance of 12% is the biggest gain since January of 1987. Optimism surrounding the European crisis, positive economic data and better than expected earnings reports have fueled the rally.

So what does all of this mean for Bonds and Phoenix home loan rates? The deal that was reached in Europe is historic, and good news for the world's economies overall. However, the plan has yet to be put into action-and then it has to work. And if there are hiccups or issues along the way, Bonds and home loan rates could benefit with some renewed safe haven trading. We saw a little of that late last week, when Friday's less than stellar Italian Bond auction reminded the world that the European debt crisis is not yet entirely resolved.

The most important thing to keep in mind is that now remains a great time to purchase or refinance a home, as home loan rates are still near historic lows. Let me know if I can answer any questions at all for you or your clients.

Forecast for the Week

Major economic data is set to impact trading behavior this week…with manufacturing and employment leading the way:

Manufacturing headlines will be in the spotlight this week with the Chicago PMI on Monday, followed by the ISM Index on Tuesday. Worker Productivity is also set for release on Thursday.
The ADP Employment Report will be the first of two key releases to gauge the labor markets. Watch for ADP to be released on Wednesday.
As usual, Weekly Jobless Claims will be delivered on Thursday. Last week's report showed that people filing for first-time benefits still remain above the 400,000 level.
Friday's Jobs Report data will garner the most attention as the Labor Department reveals how many new jobs were created in October. Last month's gain of 103,000 new workers was positive.

In addition to the reports above, the Fed Meeting begins on Tuesday and ends Wednesday with the Fed's monetary policy statement. The housing markets will be scrutinizing that statement for any rhetoric that involves possible new purchases of Mortgage Backed Securities to keep home loan rates near record lows. Recently, several Fed members have stated that the Fed needs to support the housing markets and not to see elevated borrowing costs.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.

As you can see in the chart below, Bonds and home loan rates worsened in October as Stocks had one of their best months on record. But rates remain near historic levels, and I'll be watching closely to see what happens as we move into November.

Chart: Fannie Mae 3.5% Mortgage Bond (Friday Oct 28, 2011)

The President's New Plan for Homeowners ( HARP Refinance Program )

You may have heard that President Obama plans to open up refinancing to more homeowners who are underwater. If you've been hearing questions about this program or are just curious about what the plan involves, here are some of the major highlights: So, what is HARP ?

What's Really New?

First, it's important to realize that the president's proposal is not a new program, but a revision to the current Home Affordable Refinance Program (HARP). However there are some big changes that you can let people know if they ask you.

Refinance…No Matter How Underwater

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What is HARP Conventional Streamline Refinance and Market Review

noreply@blogger.com (Philip Jensen) — Mon, 31 Oct 2011 18:44:00 +0000

Phil Jensen

Mortgage Director

AmeriFirst Financial

Phone: 602-492-8393

Phil@JensenTeam.com

Best Arizona Home Search

Arizona Home Loans

HARP Program

In This Issue

Last Week in Review: Historic news out of Europe, plus Stocks make history.

Forecast for the Week: The Fed meets, and Friday brings big Job news-will the numbers give the markets a scare?

View: Changes are coming to the Home Affordable Refinance Program. Find out what this means for homeowners.

Last Week in Review

Forecast for the Week

Major economic data is set to impact trading behavior this week…with manufacturing and employment leading the way:

Manufacturing headlines will be in the spotlight this week with the Chicago PMI on Monday, followed by the ISM Index on Tuesday. Worker Productivity is also set for release on Thursday.
The ADP Employment Report will be the first of two key releases to gauge the labor markets. Watch for ADP to be released on Wednesday.
As usual, Weekly Jobless Claims will be delivered on Thursday. Last week's report showed that people filing for first-time benefits still remain above the 400,000 level.
Friday's Jobs Report data will garner the most attention as the Labor Department reveals how many new jobs were created in October. Last month's gain of 103,000 new workers was positive.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.

Chart: Fannie Mae 3.5% Mortgage Bond (Friday Oct 28, 2011)

The President's New Plan for Homeowners ( HARP Refinance Program )

What's Really New?

Refinance…No Matter How Underwater

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What is HARP Conventional Streamline Refinance and Market Review

noreply@blogger.com (Philip Jensen) — Mon, 31 Oct 2011 16:07:00 +0000

Phil Jensen

Mortgage Director

AmeriFirst Financial

Phone: 602-492-8393

Phil@JensenTeam.com

Best Arizona Home Search

Arizona Home Loans

HARP Program

In This Issue

Last Week in Review: Historic news out of Europe, plus Stocks make history.

Forecast for the Week: The Fed meets, and Friday brings big Job news-will the numbers give the markets a scare?

View: Changes are coming to the Home Affordable Refinance Program. Find out what this means for homeowners.

Last Week in Review

So what does all of this mean for Bonds and Phoenix home loan rates? The deal that was reached in Europe is historic, and good news for the world's economies overall. However, the plan has yet to be put into action-and then it has to work. And if there are hiccups or issues along the way, Bonds and home loan rates could benefit with some renewed safe haven trading. We saw a little of that late last week, when Friday's less than stellar Italian Bond auction reminded the world that the European debt crisis is not yet entirely resolved.

Forecast for the Week

Major economic data is set to impact trading behavior this week…with manufacturing and employment leading the way:

Manufacturing headlines will be in the spotlight this week with the Chicago PMI on Monday, followed by the ISM Index on Tuesday. Worker Productivity is also set for release on Thursday.
The ADP Employment Report will be the first of two key releases to gauge the labor markets. Watch for ADP to be released on Wednesday.
As usual, Weekly Jobless Claims will be delivered on Thursday. Last week's report showed that people filing for first-time benefits still remain above the 400,000 level.
Friday's Jobs Report data will garner the most attention as the Labor Department reveals how many new jobs were created in October. Last month's gain of 103,000 new workers was positive.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.

Chart: Fannie Mae 3.5% Mortgage Bond (Friday Oct 28, 2011)

The Mortgage Market Guide View...

The President's New Plan for Homeowners ( HARP Refinance Program )

What's Really New?

Refinance…No Matter How Underwater

Now homeowners can refinance no matter how underwater they are! Before homeowners could only refinance if they were 25% or less underwater, and even then many banks only let people who were 5% or less underwater refinance.

No Appraisal Necessary?

With the program's revision, it's possible that an appraisal won't have to be performed. That's great news because it can help people save time and money. But this is only the case if Fannie Mae or Freddie Mac can electronically estimate the value through their valuation models.

But Keep in Mind…

These updates to HARP apply only to people whose mortgage is currently secured by Fannie Mae or Freddie Mac...and whose loan was securitized by Fannie Mae or Freddie Mac prior to May 31, 2009. So the chances are that people who have refinanced since May 2009 will not qualify to refinance under the HARP rev

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Conventional Streamline Refinance

noreply@blogger.com (Philip Jensen) — Wed, 26 Oct 2011 16:27:00 +0000

Phil Jensen

Mortgage Director

AmeriFirst Financial

Phone: 602-642-8393

Phil@JensenTeam.com

Arizona Mortgage Experts

Best Arizona Home Search

Conventional Streamline Refinance

In This Issue

Last Week in Review: The Fed made headlines, plus inflation is heating up!

Forecast for the Week: Some key reports on housing, plus the Fed’s favorite gauge of inflation and news from Europe could move the markets.

View: Ever feel like you ramble when you leave voicemails? Check out these tips for surefire ways to leave effective messages.

Last Week in Review

When the Fed talks, people listen. And last week, the Fed made headlines when Fed Governor Daniel Tarullo called for the Fed to engage in another round of Mortgage Bond purchases…or in other words, another round of Quantitative Easing (QE3). Read on to find out what this could mean for the housing market and home loan rates.

In order to really have an impact on housing, the Fed would have to announce something significant to get people to buy a home. Why? Because even now, with rates at historically low levels and incredible affordability levels, the sales pace in housing is tepid, due to structural problems in the labor market, which the Fed can't fix.

In fact, there is a lot to consider before the Fed starts expanding their balance sheet, and the biggest concern is rising inflation. Contrary to what the Fed has said about it moderating, year-over-year inflation is on the rise. The headline Producer Price Index (PPI) rose by a whopping 0.8% in the month of September, elevating year-over-year wholesale prices by a hot 6.9%. Meanwhile, the Consumer Price Index (CPI) for September rose by 0.3%, and while this was inline with estimates it pushed the year-over-year number to 3.9%. This is significant because the year-over-year figure was just 1.6% in January.

Remember, inflation is the arch enemy of Bonds and home loan rates. The concept is very simple: If inflation rises, investors in Bonds demand a higher yield to offset the lost buying power inflation imposes on a fixed payment. And as home loan rates are tied to Mortgage Bonds, this would mean home loan rates move higher.

And let’s not forget the ongoing drama out of Europe. French and German leaders will hold two summits in the span of four days to come up with a resolution to the European debt crisis. Whichever way this news goes could have a real effect on the markets, including Bonds and home loan rates.

With all the news to come this week, it’s still important to remember that now remains a great time to purchase or refinance a home, as home loan rates are still near historic lows. Let me know if I can answer any questions at all for you or your clients.

Forecast for the Week

Look for some key reports on the housing market, which come after last week’s better-than-expected Housing Starts and the softer numbers from Existing Home Sales.

New Home Sales are set to be delivered on Wednesday. That number has been hovering near record lows, so the markets will be anxious to see if there’s any indication of an improvement. Also this week, Pending Home Sales will be released Thursday.
Also on Thursday, Initial Jobless Claims will be released as usual. Plus, the first reading on Gross Domestic Product (GDP) for the 3rd quarter will be released. Overall, the estimates don’t appear as if the economy is hitting on all cylinders yet.
The markets will see how the American people are holding up in this economy with Consumer Confidence and Consumer Sentiment on Tuesday and Friday, respectively.
Ending the week, Friday’s Core Personal Consumption Expenditure (PCE), the Fed’s favored inflation measure, is sure to garner some attention.

In addition to those reports, keep an eye on the news. One story that could gain some attention is news that the Federal Housing Finance Agency (FHFA) and the Obama administration will submit proposals to Congress to help the housing market for those homeowners who are underwater.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.

As you can see in the chart below, Bonds and home loan rates stayed in a tight range last week. I’ll be watching closely to see how the markets react to Fed Governor Tarullo’s call for QE3, the news out of Europe, and the economic reports of the week.

Chart: Fannie Mae 3.5% Mortgage Bond (Friday Oct 21, 2011)

The Mortgage Market Guide View...




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Good News at Home and Abroad Impact Home Loan Rates

noreply@blogger.com (Philip Jensen) — Mon, 17 Oct 2011 16:08:00 +0000

Phil Jensen

Mortgage Director

AmeriFirst Financial

Phone: 480-682-6613

Phil@JensenTeam.com

www.JensenTeam.com

www.BestArizonaHomeSearch.com

In This Issue

Last Week in Review: Good news at home and abroad impacted the markets and home loan rates last week. Find out how.

Forecast for the Week: Earnings season is in full swing, plus look for big news on manufacturing, housing, and inflation.

View: Wondering about the outlook for the housing and mortgage markets in 2012? Be sure to read the article below.

Last Week in Review

“It’s a small world after all.” And that proved especially true last week, as our markets were impacted by news at home and news from overseas. Here are the highlights.

First, there was some good news on the economic front in the U.S. as Retail Sales for September rose by 1.1%, above the 0.6% expected and the highest increase in seven months. Remember good economic news typically benefits Stocks at the expense of Bonds (including Mortgage Bonds, to which home loan rates are tied), as investors move their money from the safety of Bonds into Stocks to try and take advantage of gains.

And good news here wasn’t the only thing that pressured Bonds and home loan rates last week. The European Central Bank (ECB) said they will announce a plan by early November for addressing the Greek debt crisis and make recapitalizing their banks a priority. As part of this plan, the International Monetary Fund is going to dedicate more resources to help the European debt crisis. A lot of money is needed to make investors feel confident that the debt crisis will be contained, so investors saw this as positive news.

So what does this mean for Bonds and home loan rates? Should the overall present optimistic tone continue, Bonds and home loan rates could face additional pressure. However, if there is pessimistic or uncertain news, investors may return to the safe haven of Bonds, meaning home loan rates could benefit. We did see a little of this trend last week when there was word that China's exports came in lower than expectations, which brought concern that global growth could continue to slow.

Either way, the volatility is sure to continue so the most important thing to remember is that now is still a great time to purchase or refinance a home, as home loan rates remain near historic lows. Let me know if I can answer any questions at all for you or your clients.

Forecast for the Week

Manufacturing, inflation, and housing reports dominate the news this week:

The manufacturing sector accounts for one-quarter of the economy, so it’s especially important during the current economic situation. This week, the New York State Empire Manufacturing Index as well as Industrial Production and Capacity Utilization will be released on Monday. Later in the week, the Philadelphia Fed Index will be reported on Thursday.
Inflation news from the Producer Price Index (PPI) and the Consumer Price Index (CPI) will be delivered on Tuesday and Wednesday respectively. The last report on consumer inflation was a bit hotter than expected, so Bond market players will be closely watching those reports.
Housing Starts will be reported on Wednesday and on Thursday Existing Home Sales will be delivered.
The weekly Initial Jobless Claims report will be released on Thursday. As of last week’s report, they continue to remain above the 400,000 level.

Plus, earnings season is in full swing this week. Some big names reporting earnings are Citigroup, Bank of America, Coca-Cola, Apple, and AT&T. If the reports come in better than expected, it could push investing dollars over to the Equity markets.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.

As you can see in the chart below, Bonds and home loan rates faced pressure last week but remained above a key technical level. I’ll be watching the markets closely this week to see what happens.

Chart: Fannie Mae 3.5% Mortgage Bond (Friday Oct 14, 2011)

The Mortgage Market Guide View...




	The Housing and Mortgage Markets in 2012 Last week, the Mortgage Bankers Association (MBA) released its outlook for the housing and mortgage markets in 2012. Overall, the news is mixed, but there’s some good news to glean out of it. Here are three positive elements in the MBA forecast that you should know about: 1. Home Sales Steady Before Slight Increase The MBA expects total existing home sales will stay around the 4.9 million unit pace for 2011 and 2012. But in 2013, the MBA expects home sales to increase slightly to 5.2 million units, as the broader economy recovers. New home sales are expected to be similar to the overall trend. As the MBA stated in its release: “The recovery in the new home sales will have a comparably slow start…but will show some meaningful increases in 2013.” 2. Slight Growth in Home Purchases Despite an expected decrease in refinances, the MBA forecasts some slight growth in the number of mortgages for home purchases. Specifically, the MBA anticipates home loans for purchases to increase to $412 Billion in 2012, which would be up from the anticipated 2011 total of $400 Billion. Better still, the MBA expects home loans for purchases to jump significantly to $700 Billion in 2013 as the economy, home sales, and home prices are all anticipated to pick up. 3. Rates to Remain Low Overall, fixed home loan rates are expected to remain low by historical standards. The MBA expects rates to end 2011 around a 4.5 percent average, and then possibly dropping slightly to 4.4 percent at some point in 2012. But by 2013, the MBA expects rates to climb back up to 4.9 percent – w

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Weekly Newsletter

noreply@blogger.com (Philip Jensen) — Mon, 03 Oct 2011 17:18:00 +0000

Phil Jensen

Mortgage Director

AmeriFirst Financial

Phone: 602-692-7445

Phil@JensenTeam.com

Lowest Arizona Mortgage Rates

Phoenix Homes For Sale

In This Issue

Last Week in Review: There was plenty of news for both optimists and pessimists last week. Find out what that meant for home loan rates.

Forecast for the Week: Big job news is ahead, but will it be positive or negative?

View: Changes are coming from Fannie and Freddie in 2012. Get the scoop below!

Last Week in Review

“Both optimists and pessimist contribute to our society. The optimist invents the airplane, and the pessimist—the parachute.” G.B. Stern. And last week, we saw sentiment on the economy go from pessimistic, to optimistic, and back to pessimistic—all within a week! Here are the highlights of what happened.

On the optimistic side, several economic reports were better than expected. For example, New Home Sales for August were up 6.1% from a year earlier and the Case-Shiller Home Price Index rose in July from June in the 10 and 20 city survey, and was the fourth monthly gain in a row.

What’s more, there was some positive news from overseas. European leaders are designing a Special Purpose Vehicle (SPV) that would issue Bonds and purchase European debt to try to contain the malaise in that region. Plus, Germany voted in support for the expansion of the European Financial Stability Facility (EFSF), which will be used to help Euro member countries access capital. This is optimistic news, as it shows Germany is doing whatever it can to help debt laden countries avoid default and potentially threaten the Euro union.

While this mix of news was great for our economy and the global economy, the result was a "risk on trade" where investors fled the safe haven trade of Bonds and moved into Stocks to try and take advantage of gains. And since home loan rates are tied to Mortgage Bonds, when Bonds worsen home loan rates worsen as well. That’s what we saw happen in the early and middle part of last week.

But some pessimism crept back into the markets late last week as China's Manufacturing PMI contracted for a third consecutive month. There is growing fear that a slowdown in China could affect the already fragile global economy. This is a developing story and one I will be watching closely because if China’s economy does meaningfully slow, it will likely take Stocks down another level and help Bonds and home loan rates. Also creating some pessimism late in the week: Personal Income was lower than expected, and seeing earnings contract is not a good sign for the economy.

The bottom line is that now is a great time to purchase or refinance a home, as home loan rates remain near historic lows. Let me know if I can answer any questions at all for you or your clients.

Forecast for the Week

Can the U.S. job market get back on its feet? We’ll find out this week, along with more manufacturing news:

On Monday, the ISM Index will be delivered, and it’s probably the most closely watched manufacturing report out there.
Jump ahead to Wednesday to see the first labor market reading of the week with the release of the ADP Employment Report.
Weekly Jobless Claims will be released as usual on Thursday. Last week's drop below 400,000 was welcomed by investors, but the Labor Department said the numbers were somewhat impacted by seasonal adjustment factors.
Last but not least is Friday's Jobs Report, which includes Hourly Earnings, Average Workweek, Unemployment Rate and the closely watched Non-farm Payrolls Report. In August, there were zero jobs created, which was a major blow to the psyche of the investment world. So the markets will be watching this report closely.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.

As you can see in the chart below, Bonds and home loan rates were able to remain above a key trading level. I’ll be watching closely to see which way sentiment impacts the markets this week.

Chart: Fannie Mae 3.5% Mortgage Bond (Friday Sep 30, 2011)

The Mortgage Market Guide View...




	Fannie and Freddie to Increase Fees… But What Does It Mean? Starting in 2012, Fannie Mae and Freddie Mac are expected to increase their fees, which could impact homebuyers depending on the risk of their loan or the location of their home. Here’s what you need to know – including what’s really happening and what it means to homebuyers. What fee is being increased? First, it’s important to remember that Fannie Mae and Freddie Mac do not actually make home loans. Instead, they provide financing to lenders by purchasing mortgages from those lenders. Then, Fannie and Freddie either keep those mortgages on their books or they package them (in the form of securities) for sale to investors. That means, Fannie and Freddie don’t actually charge direct fees to homebuyers. But they do charge fees to lenders when they purchase home loans from those lenders. The lenders, in turn, build those fees into the home loans they offer. So the bottom line is that any increase in the fee that Fannie and Freddie charge lenders will essentially be passed on to consumers. However, the fees likely won’t be increased the same amount across the board. For example, Fannie and Freddie may charge higher fees when purchasing riskier loans or they may vary the fees based on which part of the country the home is located in (taking into account things like the foreclosure rate of the location). Why is this happening? Fannie and Freddie were seized by the government three years ago to help protect them from failing. That’s important because Fannie and Freddie (along with other government agencies) actually guarantee about 9 out of every 10 new home loans—and with the challenges that the housing market has seen recently, those guarantees have been extremely important. However, Fannie and Freddie have also cost the taxpayers more than $140 Billion. So Fannie and Freddie will gradually increase their guarantee fees next year and reduce the size of the home loans they purchase in an effort to: 1. Save tax

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Weekly Newsletter

noreply@blogger.com (Philip Jensen) — Mon, 26 Sep 2011 17:23:00 +0000

In This Issue

Last Week in Review: The Fed met, and inserted a “twist” into things.

Forecast for the Week: A full week of economic reports is ahead, including news on inflation, the state of the economy, consumer confidence, and more.

View: No one wants to get a bad rap, especially online. Check out Part 2 of our series on improving your online persona.

Last Week in Review

"Twist and shout." The Fed inserted a “twist” into the market last week, but only time will tell if their decision will be cause for shouting. Read on to learn what the Fed did, and what this could mean for home loan rates.

The week began with speculation that the Fed would announce “Operation Twist” after its two-day meeting of the Federal Open Market Committee. What is Operation Twist? Essentially, Operation Twist is where the Fed sells its holdings of short-term securities and Notes and then purchases longer-term Notes and Bonds in order to try and lower longer term rates even further.

And Operation Twist is exactly what the Fed announced, but their announcement came with some key surprises:

First, the Fed’s statement was more strongly worded than expected, as the Fed said that there remains “significant” risks to the downside for the US economy.
Second, the funding for Operation Twist was larger than expected, coming in at $400 Billion.
Third, the Fed said they will reinvest principal payments on their current holdings of agency debt back into Mortgage Backed Securities…which led to a huge rally in the Bond Market Wednesday, while Stocks took a nose dive.

So what does all of this mean for home loan rates? The Fed’s statement has heightened pessimism, fear, and concern...and normally those sentiments help Bonds (including Mortgage Bonds, to which home loan rates are tied) improve as investors seek a safe haven for their money. But it’s important to understand that even if Bonds improve, home loan rates may not improve much further.

Why? It is basic supply and demand: lenders’ pipelines have been overflowing with people wanting to refinance or purchase a home and take advantage of the historically low rates we’ve seen. This level of volume flowing into the system has already created a backlog of work for lenders, which means they may not pass along all the gains we are seeing in the Bond Market onto their rate sheets.

The bottom line is that home loan rates remain near historic lows, and now is a great time to purchase or refinance a home. Let me know if I can answer any questions at all for you or your clients.

Forecast for the Week

Economic data will impact trading throughout the week by giving investors a broad look at the economy:

Housing will be first up with New Home Sales on Monday. Last week's housing data was mixed with lower than expected Housing Starts but Existing Home Sales came in on the positive side. Pending Sales will also be reported on Thursday.
The week will also give us a read on how consumers are feeling in this weakening economy. Consumer Confidence will be released on Tuesday and Consumer Sentiment will be delivered on Friday.
Weekly Initial Jobless claims will also be closely watched on Thursday. The job markets continue to be a drag on the economy as each week over 400,000 people are claiming unemployment benefits.
The big news this week will be the government's report on Gross Domestic Product (GDP), which will be released Thursday. With the economy slowing, GDP will be on the radar screen for signs of recessionary numbers. Also important will be Wednesday’s Durable Goods Orders, which gives us an update on consumer and business buying behavior on big-ticket items.
Investors will also be closely watching the inflation figures within the Core Personal Consumption Expenditure, which is the Fed's favorite gauge of inflation and will be reported on Friday.

In addition to those reports, investors will be closely watching the movements in the Stock Market after last week's plunge. The big questions will be: How low can Stocks go? And, are we in a bear market or just a correction phase?

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.

As you can see in the chart below, Bonds rallied last week, though they did give back some of their gains on Friday. I’ll be watching both Stocks and Bonds closely this week to see which way the markets move.

Chart: Fannie Mae 3.5% Mortgage Bond (Friday Sep 23, 2011)

The Mortgage Market Guide View...

What Does the Internet Say About You?

Part 2: Simple Steps to Improve Your Online Persona

Your online persona is a lot like a credit score. It’s already out there whether you check it or not. And other people can review it at any time.

The similarities don’t end there. Like a credit score, you can review your online persona and work to improve it…so when people like potential clients look at it, they’ll see what you want them to see.

Step One: Evaluate Your Online Persona

In order to know what your online persona looks like, you have to actually check it. So start by opening your web browser to a search website such as Google.com, Yahoo.com, Ask.com, AltaVista.com, Lycos.com, or Microsoft’s new Bing.com. Then simply type in your name and hit search. Scan through the first two or three pages to see what items are coming up most often, and make note of any negative news that you’d like to get removed.

You can also do more specific searches. For example, you can type your name in parentheses along with your email address, the name of your college, your job title, a hobby, or even other people’s names. For example, you could type “your name + friend’s name” or “your name + college name.” You may be surprised what you find with some of these specific searches.

Once you’ve searched your name on one site, open another and do the same thing. You’ll probably find a number of similarities, so you only need to check a few different sites to get an idea of what the Internet says about you. Remember to take specific notes about false or unflattering information. You’ll want to write down what it is, where it appears, and why it shouldn’t be there.

Finally, don’t forget to search for videos and images! After all, one of your friends may have posted photos and tagged you in the photo without you realizing it. You can use some of the same sites listed above—only this time, click the video or image search button before you search for your name.

Step Two: Remove Anything Negative

Like your credit score, if you find information on the Internet that is inaccurate or inappropriate, your first step should be to try to get it removed. This is where those diligent notes from step one will come in handy.

First, if you found something unflattering that you actually posted in the past, remove it yourself. For example, if you posted pictures or stories on an old blog, go back and remove them. In addition, take the time to go through any websites or social networking sites where you control the information. Maybe you have a blog, website, or social networking site that features pictures and text that you post. Go back through the information to make sure you still want people to see or read it. If not, remove it immediately…even if it didn’t show up in the search you conducted.

Second, if you found information on other websites that you think should be removed, contact them right away. Start with the websites that have the worst (most egregious or most inaccurate) information. Using a polite but firm tone, explain what content you found on their site, why it’s a problem, and then specifically ask them to remove that information from their site. Be as specific as possible. If the information is false, say that. If the information is private and used without permission, say that. You may even want to include a link to the material to make sure they can quickly find the problematic information that you’re asking them to remove.

It’s a Marathon…Not a Sprint

Remember, the Internet has a long memory. So it may take some time for those negative elements to stop showing up in searches. But by removing them, you can help make sure that even if they do show up in a search, people won’t be able to actually view the detailed information when they try to click the link.

When you combine the steps above with the process of adding new more professional content to your website, blog or social media sites, you’ll be able to continually improve your online persona!

Economic Calendar for the Week of September 26 - September 30

Date	ET	Economic Report	For	Estimate	Actual	Prior	Impact
Mon. September 26	10:00	New Home S

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Inflation Heats Up

noreply@blogger.com (Philip Jensen) — Tue, 20 Sep 2011 16:24:00 +0000

Last Week in Review: Inflation is heating up, but what does that mean for home loan rates?

Forecast for the Week: Several pieces of housing news will hit the wires, plus the Fed meets.

View: No one wants to get a bad rap, especially online. Check out these tips for building your brand on the web.

Last Week in Review

"Inflation, all we've never wanted." The Go-Go's may have sang about vacation being all we've ever wanted in the 1980's, but if we were to re-write the lyrics about last week, we could sing about inflation. Read on to learn why this matters.

We saw a double dose of inflation news last week and while the Producer Price Index (which measures inflation at the wholesale level) remained unchanged in August, the year-over-year Core Consumer Price Index (CPI) jumped up to hit the upper-end of the Fed's threshold of 2%.

So why is this significant? The concept is very simple: If inflation rises, investors in Bonds demand a higher yield to offset the lost buying power inflation imposes on a fixed payment. And as home loan rates are tied to Mortgage Bonds, this would mean home loan rates move higher.

What’s more, in light of last week’s higher consumer inflation reading, the Misery Index—which is the Unemployment Rate (9.1%) plus the level of year-over-year headline Consumer Price Index (3.8%)—is at a disconcerting 12.9, which is the highest in nearly 30 years. Our great country needs a whopping dose of certainty, clarity and confidence...and in the absence of it, this index will continue to rise.

Remember: Once inflation starts to emerge it can manifest rather quickly. Future inflation readings will be closely watched to see if a trend higher is emerging, and last week’s elevated number will certainly heat up the debate surrounding more stimulus, as more money into the system fuels inflation further. If inflation heats up even more, the Fed will likely back off their "low rates until mid-2013" mandate. Inflation really does change everything, and I will continue to follow this story closely and keep you informed.

The bottom line is that home loan rates remain near historic lows, and now is still a great time to purchase or refinance a home. If I can answer any questions at all for you or your clients, call or email me anytime.

Forecast for the Week

This week we’ll see less economic data than last week's litany of reports…but that doesn’t mean there won’t be some big news to watch!

Housing Starts for August will be delivered on Tuesday and are at extremely low levels given the current environment. The July reading was down 1.5% from June…but it was actually up 10% from a year ago in July 2010. Building Permits, a sign of future construction, will also be released on Tuesday.
More housing news follows Wednesday with the Existing Home Sales Report.
Also on Tuesday and Wednesday is the regularly scheduled Federal Open Market Committee meeting. With inflation heating up, it will be important to see what the Fed has to say.
Weekly Initial Jobless Claims will be reported on Thursday as usual, and they continue to remain above 400,000 rising to 428,000 last week.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.

As you can see in the chart below, Bonds and home loan rates did not react well to last week’s inflation news. I’ll be keeping a close eye on what happens this week.

Chart: Fannie Mae 3.5% Mortgage Bond (Friday Sep 16, 2011)

The Mortgage Market Guide View...

What Does the Internet Say About You?

Part 1: Building Your Brand Online

Managing your online persona is all about building your brand. That means taking a proactive role in determining how people see you when they search for you on the Internet. Here are a few simple ways you can take control of your online persona:

Create a Profile:

One of the easiest ways to make sure positive attributes, qualifications and accomplishments stand out on the Internet is to create a profile that features those aspects. A profile only takes a matter of minutes to create and can help boost positive information about you higher in an Internet search.

One of the best profiles to start with is a Google profile. Once you create a Google profile, your name, occupation, location and a photo (if you upload one) will appear on the first page of Google when your name is searched.

Participate in Social Networking:

You’ve no doubt heard about popular social networking sites like Facebook.com and LinkedIn.com, as well as micro-blogging sites like Twitter.com and online photo sites like Flickr.com. These sites offer you fun, interactive ways to connect with potential clients, peers, and of course family. In addition, they are great for improving your online persona because they often climb near the top of searches.

That said, there are few things to keep in mind. First, you need to “participate” not just “join.” The more information you include in your profile and the more you participate, the more useful these sites will be in building your brand.

Second, when you do participate make sure it’s relevant. Your status updates don’t have to be all business and no play; it’s okay to have a balance of your personal and professional life on these sites. But make sure that you keep it appropriate. That means keeping slang to a minimum and avoiding inappropriate words, humor, photos or stories.

Finally, make sure you take advantage of other online communities or discussion threads hosted by professional organizations. Not only will your peers and potential clients get to know you on those sites, but your posts will often find their way into your search results.

But remember: make sure you only join online groups or communities that reflect the positive image you’re trying to portray. Before joining any group or discussion thread, ask yourself if you’d feel comfortable discussing your membership in that group during a meeting with a client.

Start a Blog or Website:

One of the most productive ways to control your online persona is to create new content on a blog or website that highlights or reflects your expertise.

A blog or website not only gives you the space necessary to regular write about your areas of expertise, but they can also rank high in Internet searches if the content is updated regularly. While this step may seem a bit overwhelming at first, a number of providers such as Wordpress.com or Blogger.com make it fast and convenient. You don’t need to know how to program html or JavaScript. They do all the work for you. All you have to do is sign-in and post.

So what should you post? Use your imagination. But remember to take the pressure off yourself – after all, you don’t have to write a professional white paper in every post. Maybe you want to post about the top three things you learned at a professional conference and include a link to the conference website. Maybe you just received an award or professional certification… write about that and put a link to the site that awarded it. As long as you’re not divulging trade secrets, write about what you do, what you know, and what your job growth goals are for the future.

Interlink Your Sites:

Once you’ve created a few online profiles, started participating in social network sites, and developed a quality blog with a few posts, it’s time to make sure people notice. That means promoting each of these sites in other sites by linking to them.

So, on your Facebook page, you should include links to your Twitter account and your blog or website. On your blog or website, create a Contact Information page that includes links to your online profiles, Facebook page, Twitter account, and so on. On your profile pages, include links to your blog and social networking sites.

It sounds a bit repetitive, if not overkill. But it’s not. It’s important. Why? The simple reason is that links are factored into Internet searches. When someone does a search of your name on the Internet, the sites that typically rank the highest have the most sites linking to them. That means, the more sites that link to your blog, the better chance you have of it hitting the first page of search results.

And that’s the ultimate goal here…getting the positive information that you create to rise to the top, so people see the online persona that you’ve strategically developed and that you want them to see.

Economic Calendar for the Week of September 19 - September 23

Date	ET	Economic Report	For	Estimate	Actual	Prior	Impact
Tue. September 20	08:30	Housing Starts	Aug	575K		604K	Moderate

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Obama Spoke but Will Action Follow?

noreply@blogger.com (Philip Jensen) — Mon, 12 Sep 2011 18:29:00 +0000

In This Issue

Last Week in Review: President Obama spoke...but what actions will follow?

Forecast for the Week: With reports on inflation, manufacturing, and consumer news, there’s sure to be tons of action in the markets.

View: Got stress? Who doesn’t these days…but take a moment and learn a few specific actions you can take to reduce your stress levels.

Last Week in Review

“Actions speak louder than words.” There were certainly important words spoken last week by President Obama. Read on to learn what he said, and what the impact could be on home loan rates.

Last Thursday, President Obama proposed a $447 Billion Job Stimulus Plan, which was larger and broader than most had expected. The program calls for tax cuts, state aid, infrastructure spending, on the job training, plus some surprises like tax cuts for small business to encourage hiring and a "Helping More Americans Refinance Mortgages" or HARP plan. There are no details to the HARP plan as of yet, as the President has just instructed his team to work with Fannie Mae and Freddie Mac, the Federal Housing Finance Agency (FHFA) and lenders to develop the plan. I’ll be sure to keep you posted as more details emerge on this plan.

Only time will tell how much of the President's plan will only be talked about… and how much will be put into action that will make a difference. But one thing is for sure: With 400,000 plus brand new people still filing for first time unemployment benefits every week, action is definitely needed to create jobs. Plus, when you factor in the 3.7 Million people still collecting some sort of benefits, it’s no wonder why consumer confidence and demand is starting to revisit levels seen in the midst of the financial crisis back in 2008.

So what could all of this mean for home loan rates? Some of President Obama’s plan does indeed appear to be stimulative in the short run, and anything that helps growth would be bad for Bonds and home loan rates longer-term. However, in the short term, Bonds—including mortgage Bonds, which home loan rates are tied to—are benefitting from the continued credit crisis in Europe, as investors see our Bonds as a safe haven for their money. The bottom line is that home loan rates remain near historic lows, which makes this a great time to purchase or refinance a home. Again, if I can answer any questions at all for you or your clients, call or email me anytime.

As we pass the 10th anniversary of the terrible events of September 11, our hearts continue to go out to the families who were impacted on that day. It is a time to stop and remember, and also to consider the people in your life and what is most important about our great country. I stand with you in remembrance.

Forecast for the Week

This week's economic data is chock full of important reports that could give us hints on whether the economy is slipping into a recession or starting to turn the corner...and the action really heats up in the second half of the week:

There will be a double dose of inflation news, beginning Wednesday with the Producer Price Index (which measures inflation at the wholesale level) and then Thursday with the Consumer Price Index. CPI measures changes in the price level of consumer goods and services purchased by households, and this report will tell us if there has been a pick up in prices. If any inflationary signs appear, it could put a dent in Bond prices and home loan rates.
Retail Sales for August will also be reported on Wednesday. This gives the investor a gauge on how consumer spending is holding up in these tough times.
Thursday brings a double dose of news about the manufacturing sector, with Industrial Production and Capacity Utilization and the Philadelphia Fed Index.
Also on Thursday, we'll see another Weekly Initial Jobless Claims Report. Last week's claims equaled 414,000, above that important 400,000 level which indicates real improvement in the labor market.
Ending the week, Consumer Sentiment will be delivered on Friday-and after the previous reading, any gain will be met with open arms.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.

As you can see in the chart below, Bonds and Home loan rates were able to end the week above an important technical level due to continued problems in Europe. If you're wondering if you can take advantage of this situation, now is a great time to call or email me and learn more.

Chart: Fannie Mae 3.5% Mortgage Bond (Friday Sep 09, 2011)

The Mortgage Market Guide View...

Stop Kidding Yourself…
And Start Managing Your Stress

Just about everyone experiences stress and anxiety on some level. High-pressure jobs, relationship issues, and financial worries are just some of the causes of chronic stress. But the real issue is whether you're managing it correctly. The following information can help you do just that!

What Is Stress?

First, let’s define what we’re talking about. Stress is the body's way of coping with immediate danger. When confronted by immediate danger, nearly every system in our body modifies itself for the sake of survival. The brain releases hormones that have control over organs, including the heart and lungs, as well as functions such as circulation and digestion.

Why Does it Matter?

The reality is, when you’re facing a short-term crisis, acute stress can actually benefit you. By having a heart that's capable of beating faster and lungs that can take in more oxygen, the human body is able to react in a fight or flight manner during an emergency. Problems occur, however, when stress is experienced over a long duration—which can wreak havoc on your mind and body.

5 Tips for Reducing Stress

If you find yourself experiencing chronic stress, it is important that you make a commitment to changing certain aspects of your life. Here are five tips to help you get started:

1. Identify the Source – Identify your daily sources of stress along with your sources of comfort. If they don't readily come to mind, keeping a journal may help. Take special note of any events that consistently put a strain on your energy and time, especially those that elicit a negative physical response like a headache. After several weeks, you should have a pretty good idea of what's causing your stress.

2. Watch What You Eat – It may sound silly, but a diet that consists of lean proteins, whole grains, fresh fruits, and vegetables has been shown to help reduce stress. It's a good idea to limit foods containing high amounts of caffeine, sugar, and fat, as well as your consumption of alcohol. You should also reduce your intake of overly processed meals and fast foods.

3. Increase Daily Exercise – Exercise strengthens the heart and circulatory system as well as muscles and joints, all of which are negatively affected by chronic stress.

4. Learn to Relax – Relaxation techniques can be as simple as deep breathing and as complex as transcendental meditation. Seek out whatever interests you and learn how to relax. Maybe Yoga or Tai Chi works for you. Maybe it’s just a brisk walk, a short nap, or reading a book during a short break in the day. Or maybe, if your budget permits, you’ll want to try an occasional therapeutic massage.

5. Find Support – If the tips above don’t seem to help, it may be time to seek some help and support. Consult your health plan to see if it covers therapy of this nature. If not, use the Internet to find a support group in your area. Sometimes, just knowing you're not the only one with stress is enough to create a positive change.

As we work through challenges in the markets and the financial sector, make sure you’re taking time to take care of yourself. Use the tips above to find a healthy balance of work and play in your life!

Economic Calendar for the Week of September 12 - September 16

Date	ET	Economic Report	For	Estimate	Actual	Prior	Impact
Wed. September 14	08:30	Producer Price Index (PPI)	Aug	0.0%		0.2%	Moderate
Wed. September 14	08:30	Core Producer Price Index (PPI)	Aug

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Labor Day Holiday

noreply@blogger.com (Philip Jensen) — Wed, 07 Sep 2011 16:59:00 +0000

Labor Day Holiday

I hope you and your family enjoy the Labor Day holiday. And, I sincerely hope you have been enjoying your complimentary subscription to the MORTGAGE MARKET GUIDE WEEKLY.

Due to the holiday weekend, the next full issue will arrive on Monday, September 12. In the meantime, check out the special article below from Kiplinger.com featuring tips to help you file an insurance claim. These are great ideas to keep in mind and to share with any family, friends, and associates who may have been impacted by Hurricane Irene or other recent events.

I am pleased to provide this timely article to you as well as weekly insights into the mortgage and housing industries through the MORTGAGE MARKET GUIDE WEEKLY. If you feel that any of your clients, friends, family members, or associates would benefit from keeping up to date on market and economic trends in this easy-to-read format, please let me know, and I will be more than happy to add them free of charge.

Best wishes to you this holiday weekend. And remember, if you need any assistance at this time, just give me a call.

The Mortgage Market Guide View...

Tips to Help You File an Insurance Claim
Getting organized will help the process go smoothly.
By Cameron Huddleston, Kiplinger.com

Getting your financial life in order may seem like a daunting task. But in the May 2010 issue of Kiplinger's Personal Finance we've broken it down into quick and easy fixes you can accomplish in 15 minutes or fewer.

With storm and flood season upon us, one of our "recipes" for financial success should be tackled sooner rather than later: Snap digital photos of your household belongings. The images will help back up an insurance claim if your possessions are destroyed or stolen. Taking pictures is just a starting point for a complete household inventory, in which you itemize all your belongings and record details such as purchase price. You can use the Insurance Information Institute's free Know Your Stuff online home inventory software .

The Insurance Information Institute also offers these four tips for when you have to file an insurance claim:

1. Call your insurance company as soon as possible if your home has been damaged and let your agent know where you can be reached.

2. Make a list of your damaged property and take photographs to substantiate your losses. Having digital photos of your belongings before they were damaged and a home inventory will help with this step.

3. Keep receipts for hotel rooms and restaurant meals if you are unable to live in your home. Most companies will reimburse you for these expenses (up to 20% of the total insurance you have on the structure of your house).

4. Make temporary repairs to prevent further damage -- and keep the receipts.

Economic Calendar for the Week of September 05 - September 09

Date	ET	Economic Report	For	Estimate	Actual	Prior	Impact
Tue. September 06	10:00	ISM Services Index	Aug	NA		52.7	Moderate
Wed. September 07	02:00	Beige Book					Moderate
Thu. September 08	08:30	Jobless Claims (Initial)	9/03	NA		NA	Moderate
Thu. September 08	08:30	Balance of Trade	Jul	NA		-$53.1B	Moderate

[mmgwDisclosure]

The material contained in this newsletter has been prepared by an independent third-party provider. The content is provided for use by real estate, financial services and other professionals only and is not intended for consumer distribution. The material provided is for informational and educational purposes only and should not be construed as investment and/or mortgage advice. Although the material is deemed to be accurate and reliable, there is no guarantee it is without errors.

As your mortgage professional, I am sending you the MMG WEEKLY because I am committed to keeping you updated on the economic events that impact interest rates and how they may affect you.

Mortgage Market Guide, LLC is the copyright owner or licensee of the content and/or information in this email, unless otherwise indicated. Mortgage Market Guide, LLC does not grant to you a license to any content, features or materials in this email. You may not distribute, download, or save a copy of any of the content or screens except as otherwise provided in our Terms and Conditions of Membership, for any purpose.

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ECONOMIC FOCUS

noreply@blogger.com (Philip Jensen) — Tue, 23 Aug 2011 22:04:00 +0000

Volume 15, Issue 33

For the week of August 22, 2011

Update: Key Factors Impacting Housing

The housing market is having trouble escaping from its prolonged slump. Total home sales have been declining. Single family homebuilding construction is off. Soft job growth and tight mortgage lending are constraining home sales.

KEY FACTORS IMPACTING HOUSING

Falling Conforming Limits: The federal government will allow the conforming loan limit for government-sponsored enterprise and Federal Housing Administration loans to drop on schedule in October. Allowing the limits to decline on schedule will help allow private lenders back into the mortgage market, but the move is likely premature given the still-weak state of the housing market.

The higher loan limits affected approximately $120 billion in loans originated in 2010, or about 8% of the $1.5 trillion in mortgages made that year.

Big Foreclosure Pipeline: Foreclosure processing delays are slowing distress sales. Distressed homes remain a large share of home sales, with the National Association of Realtors reporting a 31% share.

Processing delays are hitting both ends of the pipeline. Servicers are filing fewer new foreclosures and they are disposing of fewer existing foreclosures. On balance though, servicers are disposing of distressed homes more quickly than they are filing new foreclosures. However, it may take longer than expected to work through all the foreclosures.

Weak Employment & Job Creation: Weak employment and job creation poses a downside risk that the faltering job recovery weighs on the demand for housing. Many uncertainties remain around the timing of foreclosures that could easily delay the end of the price correction. Legal issues surrounding the foreclosure process could take longer to resolve than expected.

Limited Access to Credit: Difficulties that the homebuilding industry may have in accessing credit pose a downside risk for the construction and new-home sales outlook.

Excess US Housing Inventory: The number of unwanted vacant homes is contracting, a positive sign for a struggling U.S. housing market. Excess inventory weighs on house price appreciation and homebuilding. Unwanted vacant homes are defined as those empty year-round and listed for sale or rent or held off the market for unspecified reasons. Such houses are always present on the market in some number, but the current supply is well above the norm.

The share of unwanted vacant homes was 7.4% in Q2, according to the latest Housing Vacancy Survey. A share consistent with long-term trends is 6.4%. The difference translates into 1.28 million excess vacant units, a large number, but the lowest reading since mid-2008.

The Move to Rentals: Rental activity is chipping away at the excess inventory. Households who lost homes to foreclosure and newly formed households are driving demand for rentals. Job growth remains weak, but the economy has still expanded for more than two years, producing more young families who are more likely to rent than to buy.

BOTTOM LINE
Many observers predict that the lingering housing correction will play out by early next year. House prices will be one of the last metrics to hit bottom. With prices balanced with respect to fundamentals, distress sales will drive the remaining modest 3% decline.

Key Economic Reports Released This Week

RELEASE DATE	ECONOMIC INDICATORS	RELEASED BY	CONSENSUS	Wt.	INFLUENCE ON INTEREST RATES
Mon 08/22 1:00 pm et	Weekly Bill Auction	Dept. of the Treasury	N/A	**	If strong demand If weak demand
Tue 08/23 10:00 am et	New Home Sales for July '11	Bureau of the Census Dept. of Commerce	315k	**	If above consensus If below consensus
Tue 08/23 1:00 pm et	2-Year Note Auction	Dept. of the Treasury	$35.0B offering	**	If strong demand If weak demand
Wed 08/24 7:00 am et	MBA Mort Apps Survey for week ending 08/19	Mortgage Bankers Association of America	N/A	*	Undetermined
Wed 08/24 8:30 am et	Durable Goods Orders for July '11	Bureau of the Census Dept. of Commerce	2.0%	**	If above consensus If below consensus
Wed 08/24 1:00 pm et	5-Year Note Auction	Dept. of the Treasury	$35.0B offering	**	If strong demand If weak demand
Thu 08/25 8:30 am et	Jobless Claims for week ending 08/20	Bur. of Labor Statistics Department of Labor	410k	*	If above consensus If below consensus
Thu 08/25 1:00 pm et	7-Year Note Auction	Dept. of the Treasury	$29.0B offering	**	If strong demand If weak demand
Fri 08/26 8:30 am et	Gross Domestic Prod (GDP) Q2 '11 preliminary	Bur. of Econ. Analysis Dept. of Commerce	2.3%	****	I! f above consensus If below consensus
Fri 08/26 10:00 am et	Consumer Sentiment for August ' 11	University of Michigan	55.0%	*	If above consensus If below consensus

* Low Importance

** Moderate Importance

*** Important

**** Very Important

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Week in Review

noreply@blogger.com (Philip Jensen) — Mon, 22 Aug 2011 16:45:00 +0000

Last Week in Review : What does the wild market mean to home loan rates?

Forecast for the Week : The markets will be waiting with bated breath. Read why!

View : How do you maintain focus on your work? Two tips to achieve success!

Last Week in Review

"It's a small world after all." The wild ride over the last few weeks continued again last week, as the US markets danced to the tune of the European debt and economic crisis. Here's what it means to home loan rates here in the US.

Even inflation hasn't stopped Bonds. Last week, consumer inflation and producer inflation came in above expectations. Remember inflation is the archenemy of Bonds and home loan rates, so hotter inflation would normally negatively impact Bonds and home loan rates. But even last week's inflation news didn't impact Bonds.

Seeing Bonds dismiss that inflation news indicates that the Bond market senses that the economy (which is already hardly growing) is in a very vulnerable position with things in Europe uncertain and gloomy at best. And when the situation deteriorates further, it may push many world economies into a recession.

It's all about Europe. US Bonds - including Mortgage Bonds - have been seen by the markets as a safe haven bid on existing and growing fears that Europe's debt crisis is coming to a head…and global growth, which is already anemic, is being threatened further. Not helping the situation was the news last week that there is no concrete solution to the European debt problems. Last week, French President Nicolas Sarkozy and German Chancellor Angela Merkel met. However, following the meeting, Sarkozy stated that "EuroBonds can be imagined one day, but at the END of the European integration process, not at the BEGINNING."

That was a pretty clear message to the financial markets that the creation of a EuroBond is not within the remote daydreams of Germany, which is the strongest nation in Europe and who will determine whether it gets created or not. So let's be clear, the German taxpayers want no part of a EuroBond, since it would use the surplus that Germany has worked hard to create to fund the poor habits and debt of weaker and less responsible member States.

The bottom line is that the fear and uncertainty right now is pretty overwhelming, which is supporting Bonds and home loan rates. But Bonds are at "nose bleed levels" and sentiment can change very quickly. If you or someone you know has been considering refinancing or purchasing a home this is an ideal time to look at their unique situation. It only takes a few minutes to look at the options that are available right now.

Forecast for the Week

This week's economic calendar is light but the impact could be big:

New Home Sales will be released on Tuesday. This report comes after a drop in Existing Home Sales, Housing Starts and Building Permits. It would be nice to see some improvement - but the market expectation isn't high.
Gross Domestic Product for the 2nd quarter will be released on Friday, and investors will be waiting with bated breath for signs of weakening in the US economy. The initial read for Q2 came in low. If the second read is weak, Stock markets could move a leg lower and give Bonds a boost. But the report isn't released until Friday, so Stocks and Bonds will fight for investing dollars throughout the week.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.

As you can see in the chart below, Bonds and Home loan rates improved last week but tapered off a bit on Friday. Stock markets fell once again last week on fears of a double-dip recession. That coupled with a plunge in the Philly Fed Index along with weak housing numbers fueled a rally in the Bond markets that saw Mortgage Bonds hit fresh 2011 highs before giving up some of those gains on Friday.

Overall, however, home loan rates are still at some of the most attractive levels ever seen - making now a great time to consider a refinance or home purchase.

-----------------------

Chart: Fannie Mae 3.5% Mortgage Bond (Friday Aug 19, 2011)

The Mortgage Market Guide View...

Focus to Finish: A Mindset
By Jason W. Womack, MEd, MA

When it's time to sit down and work on your work, how do you hold your focus?

Over the past 5 months I've been working on the book. In that time, I've tried it ALL! I've planned extra days in hotel rooms, blocked time on the calendar, hired editors, I've even kept the calendar completely clear for one 3-day stretch, all to buy a little extra time to write.

Here's what I've learned (or deepened my understanding of) over the past several months:

1. I've got to have a solid "start point." When I sit down to write, it helps a TON if I've already decided WHAT I'm going to draft in that session. Now, EVERY time I do this, the topic is expanded on, but...I don't waste any time getting started. I sit down. I write.

2. I (and this is me, what about you?) need to have some finish line in mind. And, it can't be time. I don't know why, but saying to myself, "I'm going to write until 3:45pm" just doesn't get me going as much as, "I'll take my next break after I've written 3,000 words."

A starting line. A finish line. Maybe that's why I like triathlons so much!

Jason W. Womack is an author and advisor, and founder of The Womack Company, a productivity-training firm based in Ojai, California. Jason's next book will be published in January 2012. Pre-order copies today at http://www.amazon.com/Your-Best-Just-Got-Better/dp/1118121988/ref=sr_1_1?ie=U... .

--------------------------

Remember, as a general rule, weaker than expected economic data is good for rates, while positive data causes rates to rise.

Economic Calendar for the Week of August 22 - August 26

Date	ET	Economic Report	For	Estimate	Actual	Prior	Impact
Tue. August 23	10:00	New Home Sales	Jul	310K		312K	Moderate
Wed. August 24	08:30	Durable Goods Orders	Jul	2.0%		-1.9%	Moderate
Thu. August 25	08:30	Jobless Claims (Initial)	8/20	400K		408K	Moderate
Fri. August 26	08:30	Gross Domestic Product (GDP)	Q2

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Volatility Rules the Markets.

noreply@blogger.com (Philip Jensen) — Mon, 15 Aug 2011 17:17:00 +0000

In This Issue...

Last Week in Review: Volatility was the name of the game, with steep selloffs in Stocks and whipsaw trading. How did Bonds and home loan rates fare?

Forecast for the Week: With housing news, manufacturing news, and inflation news, plus the continued credit crisis in Europe, more volatility could be in store.

View: Still trying to understand the implications of Standard & Poor's downgrade of the United States' credit rating? Check out the key points below.

Last Week in Review

"Where do we go from here?" That question from Alicia Keys' song was one many traders were probably asking, after a week where we saw a massive and historic selloff in Stocks and rallies in safe-haven instruments like Treasuries and Gold. What happened and what does all of this mean for Bonds and home loan rates? Read on for details.

Standard and Poor's downgrade of the United States' credit rating from AAA to AA+ late Friday, August 5th led to an especially volatile week, with the Dow Jones Industrial Average falling over 600 points and the S&P 500 Index experiencing its worst day since December 1, 2008-and that was just on Monday! The extreme volatility continued through the week, including Tuesday after the Fed released their Policy Statement, which was rather downbeat on the economy. In fact, Fed Chairman Ben Bernanke said, "Economic growth so far this year has been considerably slower than the Committee had expected."

So where does our economy go from here?

The incoming economic data will be under a microscope, as global markets try to decipher if the US (and the world) is slipping back into a recession, or just experiencing a slow patch. If economic reports here in the US show even modest strength and an improvement from the recent weak news, Stocks could retrace some lost ground, which would come at the expense of Bonds and home loan rates. We saw some of this happen late last week, after Initial Jobless Claims fell below 400,000 for the first time in weeks and Retail Sales for July had their biggest increase in four months.

That being said, the current and ongoing concerns out of Europe should continue to provide a safe haven bid into the US Bond market... and this will help Bonds and home loan rates. But as you can see, with so many if's, about the only thing we can be sure of is more volatility.

Wherever we go from here, the key takeaway is that RIGHT NOW, home loan rates remain near some of the best levels we've ever seen. If you've been thinking about buying or refinancing a home, give me a call or send me an email to learn how you can take advantage of this situation. Or forward this newsletter on to someone you know who may benefit.

Forecast for the Week

A slew of economic reports this week could give us a hint as to where we're heading. Look for:

Housing news with July's Housing Starts and Building Permits Report on Tuesday and July'sExisting Home Sales Report on Thursday.
Inflation news with the Producer Price Index, which measures inflation at the wholesale level, on Wednesday, followed by Thursday's Consumer Price Index. Inflation readings are important to watch right now, as a deflationary or low inflation environment will support low home loan rates.
Manufacturing news with Thursday's Philadelphia Fed Index.
Thursday also brings another weekly Initial and Continuing Jobless Claims Report. Last week's Initial Claims came in at 395,000, below the crucial 400,000 level which signals real improvement in the labor market.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.

As you can see in the chart below, Bonds and home loan rates reached some of their best levels last week, and still remain at great levels even with all the volatility. Let me know if you have any questions at all about whether you can benefit from this situation.

-----------------------

Chart: Fannie Mae 3.5% Mortgage Bond (Friday Aug 12, 2011)

The Mortgage Market Guide View...

The Downgrade and Home Loan Rates

Standard & Poor's (S&P) downgrade of the United States' credit rating from AAA to AA+ was historic-and Stocks have certainly been volatile since the downgrade.

But US Bonds and home loan rates haven't been crushed by the news. If you've heard questions about the downgrade and home loan rates, keep the following points in mind:

Despite the downgrade, there are a number of factors that bode well for US Bonds and home loan rates.
S&P is currently the only credit rating agency that has downgraded the United States.
Both credit rating agencies Moody's and Fitch have maintained the United States' AAA rating.
More importantly, the ongoing credit crisis in Greece and other parts of Europe means that US Bonds are still considered one of the safest places to invest.

The bottom line is that home loan rates remain near their historic best levels, but about the only thing that is certain in the markets right now is the volatility. If you know someone who has been thinking about buying a home or refinancing, call or email today to get started.

--------------------------

Economic Calendar for the Week of August 15-19, 2011

Remember, as a general rule, weaker than expected economic data is good for rates, while positive data causes rates to rise.

Economic Calendar for the Week of August 15 - August 19

Date

Economic Report

For

Estimate

Actual

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What Happens In Washington Doesn't Stay in Washington

noreply@blogger.com (Philip Jensen) — Mon, 25 Jul 2011 15:59:00 +0000

In This Issue...

Last Week in Review: You could feel the heat last week, both around the country and in Washington DC, as the debt ceiling debate raged on.

Forecast for the Week: Earnings season continues, plus reports on housing, the economy, and how the consumer is feeling.

View: Flying the skies just got friendlier, thanks to these new rules.

Last Week in Review

"The heat is on." The title of that Glenn Frey song not only applied to the sweltering temperatures around much of the nation last week, it also applied to the debt ceiling debate, as the heat was on our leaders in Washington to finalize a solution to our debt situation. Why is this important? Read on for details.

It only takes a look at what is happening in Europe these days to understand why it's crucial that the United States finds a solution to the debt ceiling issue. Not only have eight European banks recently failed a stress test, but last week there was news that Greek, Italian, Portuguese, and French "credit default swaps" (which are insurance policies against default) were trading at record levels. While the European Union is continuing to work to contain Europe's debt problems and prevent a default in Greece (and elsewhere), these events bode a very important lesson for the US.

Why? Because solving our debt ceiling debate and finding a long-term plan for lowering our deficit and being fiscally sound will raise confidence in our debt and help the US keep its AAA credit rating from the various credit rating firms like Moody's and Standard and Poor's. This will help investors continue to see the US as the ultra safe haven for their money, which is a key aspect of our continued economic recovery.

Speaking of our economic recovery, there was some good news last week for the housing sector, as June Housing Starts and Building Permits were both reported better than expected. While this is only one number and one number doesn't make a trend, this is a good figure, and I will be watching closely for follow through in future readings.

If you've been thinking about buying or refinancing a home, give me a call or send me an email to learn how you can take advantage of home loan rates that remain near some of the best levels we've seen this year. Or forward this newsletter on to someone you know who may benefit.

Forecast for the Week

Earnings season continues, with reports from 3M, Ford, and Exxon, among others. Plus, a busy week is ahead when it comes to economic reports. Look for:

On Tuesday we'll get an idea about how people are feeling about the economy with the Consumer Confidence Report.
Tuesday also brings a report on New Home Sales, which will be followed by the Pending Home Sales Report on Thursday.
Thursday also brings another weekly Initial and Continuing Jobless Claims Report. Last week's Initial Jobless claims came in at 418,000, above the 400,000 mark for the 15th consecutive week. This leading indicator on job market health tells us that the labor market pains have not subsided.
Rounding out the week is a double read on the state of the economy with Wednesday's Durable Goods Orders, which gives us an update on consumer and business buying behavior on big-ticket items, and Friday's Gross Domestic Product Report, which is the broadest measure of economic activity.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.

As you can see in the chart below, uncertainty in Washington and overseas caused volatility and anxiety in the markets last week, which put pressure on the Bond market and home loan rates. But remember, rates are still very attractive right now. Let me know if I can answer any questions for you.

Philip Jensen Arizona Mortgage Phoenix home loan Arizona homes for sale great Arizona schools

-----------------------

Chart: Fannie Mae 4.0% Mortgage Bond (Friday Jul 22, 2011)

The Mortgage Market Guide View...

New Passenger-Friendly Rules for Air Travel

New rules will also raise compensation if you're bumped.

By Susannah Snider, Kiplinger.com

When Jacqueline Tanzella flew from San Francisco to Florida recently for a family vacation, she paid $25 for Delta Airlines to check her bag. She landed around midnight; her suitcase didn't. Tanzella made it through the night by borrowing pajamas from an aunt and a new Superman toothbrush from her nephew. But she wasn't happy. "I didn't pay a $25 fee only to be inconvenienced by not having my bag until the next morning," she says. "Most retailers would reimburse me or give me a credit in a situation like this."

Baggage fees are getting scrutiny in expanded airline passenger protections announced by the Department of Transportation. One rule requires airlines to reimburse bag-check fees if your luggage is lost. That won't help fliers like Tanzella, whose bags are merely delayed, and some experts are grumbling that the protections lack bite. "It is only incremental improvement," says Rick Seaney, of FareCompare.com. The new protections will also increase the amount that airlines must pay passengers who are involuntarily bumped (from a maximum of $800 now to a maximum of $1,300), limit the time international flights may sit on the tarmac, and require taxes and fees to be more clearly displayed in advertised fares.

Expect some negative side effects. For instance, less overbooking by airlines to avoid higher "bump" fees could put upward pressure on fares, says CrankyFlier.com's Brett Snyder. The new rules go into effect in August.

Reprinted with permission. All Contents c2011 The Kiplinger Washington Editors. www.kiplinger.com.

--------------------------

Economic Calendar for the Week of July 25-29, 2011

Remember, as a general rule, weaker than expected economic data is good for rates, while positive data causes rates to rise.

Economic Calendar for the Week of July 25 - July 29

Date

Economic Report

For

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Recovery Slows, Housing Opportunity Grows

noreply@blogger.com (Philip Jensen) — Wed, 08 Jun 2011 17:33:00 +0000

Phil Jensen
Amerifirst Financial
Office: 480-682-6613

Phoenix Mortgage Arizona Home Loans

AZ Homes For Sale Houses For Sale AZ

Arizona Homes For Sale AZ High Schools

Phoenix Homes For Sale

Arizona Real Estate Lead Generation

In This Issue...

Last Week in Review: Volatility was extremely high... but the bottom line is a tremendous opportunity. Read the details below!

Forecast for the Week: Go beyond economic reports! Find out what to watch and why.

View: Know a college student who graduated or will soon? Here are 10 great gift ideas you may never have considered!

Last Week in Review

"SLOW DOWN... YOU MOVE TOO FAST." Maybe the economic recovery is taking acue from these 1960's lyrics by Simon and Garfunkel, as the economic recovery seems to be in a sluggish state at the moment. And while it doesn't leave too many Americans "feelin' groovy," there are some amazing opportunities at hand in housing. Here's what you need to know about the economy and housing industry - along with one sure thing about the current situation.

Volatility was extremely high last week - not just in the financial markets, but also in the economic reports and economic outlook. The big news of the week was the official Jobs Report, which came in well below expectations. In fact, in the private sector alone, the report indicated that only 83,000 jobs were created in May - and that number was almost 100,000 less than expected!

Although the Hourly Earnings component of the report came in a little better than expected, the overall report was just plain bad. Even for a market hungry for good news, there was no way to spin this report. Now the markets will have to wait and see if this was a one-off bad report and just a bump in the road to recovery... or if things have indeed slowed down once again.

Manufacturing slowing?

New data on the manufacturing sector of the economy also indicated a possible slowdown, as the Chicago PMI and the ISM Index - which both measure manufacturing - came in below expectations.

Rumors of a bailout lower the US Dollar.

In news across the pond, reports came out last week that Germany is putting together a plan to bailout Greece. The plan would "kick the can down the road" a little longer for Greece, allowing them more time to figure out a strategy to get their debt in order. As a result of these bailout hopes, the Euro was strengthened and the US Dollar dipped lower. Remember, a softer US Dollar helps US Stocks, as US companies benefit from stronger exports with a weakening Dollar. But a lower Dollar isn't so good for Bonds, so this news stalled the rise of Bonds early last week.

Home prices still very affordable.

Moving from Europe back home to the US, we also received new data last week on home prices across the country. According to the 20-city Case-Shiller Home Price Index, prices were down 0.8% in March. Overall, foreclosures and bank-owned sales continue to weigh on housing - and are expected to do so for a couple more quarters. That said, the housing market is very localized, so only a local real estate professional can help you understand where home prices are at in your community - let me know if you need a referral to someone great in your area.

One thing's for sure...

If you or someone you know is considering purchasing a home or refinancing, this is an ideal time to see how you can benefit from the current market conditions. Home prices are extremely affordable right now and home loan rates are near historic lows.

It only takes a few minutes to look at some options that fit your unique goals and situation. Call or email today to see how you can benefit from the current situation!

Forecast for the Week

After last week's volatility, the markets receive a bit of a reprieve - with no major reports due out until mid-week. Here are some reports to watch, followed by some news items that may impact Bonds and home loan rates in the days ahead:

The Fed's Beige Book will be released on Wednesday. The Beige Book contains anecdotal information on the current economic and business conditions. Although some people consider the Beige Book to be a lagging report, it can serve as a helpful indicator of the Fed's policy decisions. It reflects data from bank reports, as well as interviews with key business contacts, economists, market experts, and other sources. After the volatility and negative news last week, this report will be as important as ever.
The Jobless Claims report comes out Thursday. Last week, Initial Jobless Claims were within expectations, so it wasn't a horrible reading. That said, the disappointing Jobs Report demonstrates that employment is definitely still a concern, so the markets will be watching the Jobless Claims report closely this Thursday.
Also on Thursday, we'll see the Balance of Trade report, which focuses on exports and imports. Remember, a negative balance of trade - or a deficit - occurs when imports surpass exports. Rising deficits can be reflective of increased consumption, which can be a sign of a strengthening economy.

But don't let the slow week of economic reports fool you.

With just a few economic reports to digest and the earnings season over, the Bond markets will take their cue from how the Stocks markets move.

Soft economic data has put a dent in Stock prices in the past month, so investors may be leery to commit any new funds into the equity markets and could support Bonds. However, the Bond markets will have to contend with $66 Billion in Notes and Bonds to be offered by the Treasury - and the auctions could weigh on Bonds and home loan prices.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.

As you can see in the chart below, Mortgage Bonds and home loan rates have benefited from weak economic data the last couple of weeks. That makes now a great time to purchase a home or refinance. Call or email to see some options that may pleasantly surprise you.

Chart: Fannie Mae 4.0% Mortgage Bond (Friday Jun 03, 2011)

The Mortgage Market Guide View...

10 Great Gifts for College Grads

Help them get a head start in the real world.

By Cameron Huddleston, Kiplinger.com

Some college seniors may be hoping Mom and Dad will spring for an all-expenses-paid trip to Europe so they can go "find themselves" or just take time off before starting the daily grind of 9-to-5 life. Aside from the fact that most parents can't afford this sort of gift, it won't help new grads get a head start in the real world.

If you're looking for practical graduation gift ideas, consider these:

Interview attire. It's crucial to project the right image if you want to get a job and get ahead. But college seniors are more likely to have closets filled with shorts, jeans and t-shirts than work-appropriate attire. So take your grad shopping for a good suit. For families on a budget, give a nice tie, dress shirt and perhaps some sensible shoes. And share these ten tips with your grad so he or she can ace an interview.

Financial advice. If your child knows little about the basics of investing or personal finance, help her learn with a few good books. For easy-to-read primers, see 4 Great Financial Books for Recent Grads. Or get her a subscription to Kiplinger's Personal Finance magazine for just $12.

Gym membership. Help your grad release steam after a long day of work at a new job with a gym membership, the price of which tends to drop in spring and summer (so you'll get a deal).

Kitchenware. This is a gift people often think of for newlyweds. But college grads can benefit from having pots and pans to cook meals at home and save. Plus, kitchenware tends to go on sale in May, so you should be able to find deals.

Grocery gift card. Encourage your grad to cook at home with a gift card to a grocery store. Hopefully, she'll be less tempted to dine out if she can stock her refrigerator for free. You can find discount grocery gift cards at Gift Card Granny.

A mattress. Everyone has to sleep. So your college student will surely appreciate a real bed -- rather than that worn-out futon he was sleeping on in his college apartment. And May is a good time to buy mattresses, which can be marked down by as much as 50% as retailers try to make way for newer models.

Security deposit for an apartment. For grads just starting out, coming up with the first month's rent and a security deposit can be tough if their first paycheck won't show up until the end of the month. And you don't want them to have to rely on a credit card to make these payments. So consider chipping in by offering to write a check for the security deposit or one month's rent.

Renter's insurance. First-time renters often don't realize that they'll have to pay to replace their stuff if it's stolen or damaged by fire or another disaster -- unless they have renter's insurance. You can help them protect their belongings and finances by purchasing them a policy, which usually costs $200 to $300 a year.

Help with student-loan payments. Students with loans usually get a six-month grace period before they have to start making payments. If your grad doesn't have a job by that point, he might need help footing the monthly bill because you don't want him to default (see The Dark Side of Student Loans). Consider pitching in until he gets a steady paycheck or can find relief through a loan-deferment program.

A head start on retirement savings. If your grad will have earned income from a job, you can open and fund a Roth IRA for her. Even if she has a workplace retirement account, she'll benefit from a Roth because she'll be able to withdraw the money tax-free in retirement. She also can withdraw contributions (not earnings) at any time tax- and penalty-free. To learn more, see The Basics of Roth IRAs.

Reprinted with permission. All Contents c2011 The Kiplinger Washington Editors. www.kiplinger.com.

Economic Calendar for the Week of June 6-10, 2011

Remember, as a general rule, weaker than expected economic data is good for rates, while positive data causes rates to rise.

Economic Calendar for the Week of June 06 - June 10

Date	ET	Economic Report	For	Estimate	Actual	Prior	Impact
Wed. June 08	02:00	Beige Book					Moderate
Thu. June 09	08:30

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Recovery Slows, Housing Opportunity Grows

noreply@blogger.com (Philip Jensen) — Mon, 06 Jun 2011 19:35:00 +0000

Phil Jensen

Mortgage Director

AmeriFirst Financial

Phone: 602-692-7445

Fax:

Arizona Homes for Sale

Arizona Schools

In This Issue...

Last Week in Review: Volatility was extremely high... but the bottom line is a tremendous opportunity. Read the details below!

Forecast for the Week: Go beyond economic reports! Find out what to watch and why.

View: Know a college student who graduated or will soon? Here are 10 great gift ideas you may never have considered!

Last Week in Review

Manufacturing slowing?

New data on the manufacturing sector of the economy also indicated a possible slowdown, as the Chicago PMI and the ISM Index - which both measure manufacturing - came in below expectations.

Rumors of a bailout lower the US Dollar.

Home prices still very affordable.

One thing's for sure...

It only takes a few minutes to look at some options that fit your unique goals and situation. Call or email today to see how you can benefit from the current situation!

Forecast for the Week

The Fed's Beige Book will be released on Wednesday. The Beige Book contains anecdotal information on the current economic and business conditions. Although some people consider the Beige Book to be a lagging report, it can serve as a helpful indicator of the Fed's policy decisions. It reflects data from bank reports, as well as interviews with key business contacts, economists, market experts, and other sources. After the volatility and negative news last week, this report will be as important as ever.
The Jobless Claims report comes out Thursday. Last week, Initial Jobless Claims were within expectations, so it wasn't a horrible reading. That said, the disappointing Jobs Report demonstrates that employment is definitely still a concern, so the markets will be watching the Jobless Claims report closely this Thursday.
Also on Thursday, we'll see the Balance of Trade report, which focuses on exports and imports. Remember, a negative balance of trade - or a deficit - occurs when imports surpass exports. Rising deficits can be reflective of increased consumption, which can be a sign of a strengthening economy.

But don't let the slow week of economic reports fool you.

With just a few economic reports to digest and the earnings season over, the Bond markets will take their cue from how the Stocks markets move.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.

Chart: Fannie Mae 4.0% Mortgage Bond (Friday Jun 03, 2011)

The Mortgage Market Guide View...

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Top 10 Arizona Home Buying Mistakes

noreply@blogger.com (Philip Jensen) — Thu, 02 Jun 2011 21:55:00 +0000

TOP 10 HOME BUYING MISTAKES

Here are some of the most important and common mistakes made by home buyers. Keeping these in the forefront will help you go thru the mortgage process without major issues and help ensure a more enjoyable experience. While the following list includes many of the concerns you might encounter, it by no means is exhaustive.

Shopping for a home without being pre-approved. As a potential buyer competing for a property, you'll have a better chance of getting your offer accepted by being as prepared as possible. Consider this hierarchy of preparedness:
- Noy pre-qualified nor pre-approved
- Pre-qualified (Meaningless)
- Pre-approved
- Full approval, Commitment Letter from a local Phoenix Mortgage Company (AmeriFirst Financial )

When a seller looks at the qualifications of the buyer they are concerned with one thing! If I accept this offer will the buyer be able to perform. Meaning will you be able to obtain the loan in order to complete the purchase. As you can imagine, the sellers comfort level with any offer increases according to the documentation the buyer is able to provide demonstrating their ability to obtain loan approval. You must also remember the seller will for all practical purposes be taking the home off the market and be forgoing any other offers while engage in a contract with you. In addition, while the seller is looking at your offer and ability to perform, they are also comparing your offer with any other offers they may have. As a seller, let’s consider what type of buyer you would feel the most comfortable with.

Not pre-qualified or pre-approved

This buyer provides no evidence that they can afford to purchase your property. You may wonder how serious they are since they're not at least pre-qualified.

Pre-qualified

This buyer has met with a mortgage broker (or lender) and discussed their situation. The buyer has informed the broker regarding their income, expenses, assets and liabilities. The broker may also have seen their credit report. The buyer provided you with a letter from the broker stating an opinion of what the buyer can afford.

Pre-approved

This buyer has provided a broker written evidence of income, expenses, assets, liabilities and credit. All information has been verified by a lender. As a result, much of the paperwork for this buyer's loan has been completed. This buyer will probably be able to close quickly. They provide you with a letter (pre-approval certificate) from the lender. You're as certain as possible that this buyer can close. As a potential buyer, you can see that being pre-approved will give you the best chance of getting your offer accepted. This is critical in a competitive situation.

Full Approval from Local Phoenix Mortgage Company

Similar to a Pre-Approval in that the buyer has provided documentation supporting income, assets and has a credit report evaluated. However, working with The Arizona Mortgage Experts also include an automated approval and expertise on Arizona Purchase contract, guidelines and programs that help ensure a smooth transaction for everyone involved.

Verbal Agreements. Never agree to sign any document that contains instructions or commitments at odds with any verbal agreements you have with the seller. For example, the seller verbally agrees to include the washing machine in the sale, but the written purchase contract excludes it. The written contract will override the verbal contract. Do not expect oral agreements to be enforceable.
Choosing a lender because they publish the lowest rate. While the interest rate is important, you should consider the total cost of your loan including the loan fees, origination and discount points. When receiving a quote from a lender or broker, insist that the discount points (used to reduce the rate) be separated from origination points (charge for originating the loan).
While the cost of the mortgage is very important, it shouldn't be your sole criteria. It is essential that you have confidence that the company you select is reputable and will deliver the loan with the terms and costs they promised. I can’t stress this enough, many unscrupulous mortgage company’s both online and in person can and will offer mortgage terms they can’t deliver. The old saying is still true, if it sounds too good to be true it is! With recent changes to Arizona Real Estate contracts it is more important than ever to select a mortgage company that you can trust.
Not receiving a Cost Estimate. Within three business days after the broker or lender receives your complete loan application, you must receive a written statement of fees associated with the transaction. This is both the law and the best way to determine what you'll pay for your loan. Bring the Good Faith Estimate (GFE) with you when you sign loan documents. You should not be expected to pay fees which are significantly different from those contained in your GFE.
Not getting a rate lock in writing. When you decide to lock your interest rate and the lender tells you they have, it’s a good idea to get the lock confirmation in writing and should include the length of the rate lock, and program details.
Using an dual agent--i.e., an agent who represents the buyer and the seller in the same transaction. Buyers and sellers have opposing interests. Sellers want to receive the highest price, buyers want to pay the lowest price. In the standard real estate transaction, the seller pays the real estate commission. When an agent represents both buyer and seller, the agent can tend to negotiate more vigorously on behalf of the seller. As a buyer, you're better off having an agent representing you exclusively. The only time you should consider a dual agent is when you get a price break. In that case, proceed cautiously and do your homework, making sure your agent is qualified for the job!
Buying a home for sale in Arizona without professional inspections. Unless you're buying a new home with warranties on most equipment, it's highly recommended that you get property, roof and termite inspections. This way you'll know what you are buying. Inspection reports are great negotiating tools when asking the seller to make needed repairs. When a professional inspector recommends that certain repairs be done, the seller is more likely to agree to do them.
If the seller agrees to make repairs, have your inspector verify that they are done prior to settlement. Do not assume that everything was done as promised.
Not shopping for home insurance until you are ready to close. Start shopping for insurance as soon as you have an accepted offer. Many buyers wait until the last minute to get insurance and do not have time to shop around.
Signing documents without reading them. Whenever possible, review in advance the documents you'll be signing. (Even though some specifics of your transaction may not be known early in the transaction, the documents you'll sign are standard forms and are available for review.) It's unlikely that you'll have sufficient time to read all the documents during the closing appointment.
Not allowing for delays in the transaction. In a perfect world, all real estate transactions close on time. In the world we live in, transactions are often delayed a week or more. Suppose you asked your landlord to terminate your lease the day your purchase transaction was scheduled to close. A day or two before your scheduled closing date, you discover your transaction is delayed a week. In a perfect world, no one is inconvenienced and your landlord is willing to work with you. More likely, however, your landlord is inconvenienced and angry. Will you be thrown out? Will you have to find interim housing for a week or more? The eviction process takes a little time, so the Sheriff won't immediately remove you, but this type of stress-producing episode can be avoided. How? Terminate your lease one week after your real estate transaction is scheduled to close. That way, if there is a delay in closing your transaction, you have some leeway. This approach might cost a little more, but then again, it might not.

For additional information on Phoenix Mortgages visit the Arizona Mortgage Experts.

For information on AZ Homes For Sale visit Phoenix AZ Home Deals.

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Five Tips for Buyers Entering the Phoenix Home Market

noreply@blogger.com (Philip Jensen) — Thu, 02 Jun 2011 17:49:00 +0000

FIVE TIPS FOR NEW HOME BUYERS ENTERING THE MARKET

Market Timing
Many Buyers try and time the market hoping to get the lowest possible price. In areas where prices are declining, it is very enticing for potential buyers to try to wait as long as possible in the hopes home prices will decline even further. This strategy can be costly because when there is high inventory, smart sellers price their homes accordingly. Typically they are not priced according to past sales but according to current conditions.

Shopping Around Is Alright But Don't Over Do It
The latest reports from the National Association of REALTORS indicate that homes are staying on the market for several months. Due to the increased inventory, it affords homebuyers a great opportunity to compare several homes that meet their requirements. This does not mean that homebuyers should wait too long. If you view a home that has all the features you love, by all means, put in an offer! If you wait too long you run the risk that another buyer my get there first.

Follow Mortgage Rates
The first half of 2011 has seen some of the lowest, Phoenix mortgage rates in recent memory. This presents a great opportunity for new buyers and first time home buyers to enter the market. Basic mortgage calculators can help you determine just how much you will pay per month, based on a given rate. For example, a monthly payment on a 5.00% 30-year fixed mortgage on a 200,000 loan will be $1,073.64, and APR of 5.31%. You will still need to add Homeowners insurance, Taxes and HOA charge (if applicable). Feel free to contact us today or click Phoenix Mortgage to apply online to see where you stand

Don’t Delay
After you have shopped around and know what features you would like in your new home and the area you would like to live in as well as the market prices. Once you find the home that fits the criteria, when the right home come up, don’t’ delay, many people will attest that they let the perfect home slip away after procrastinating for too long. Once you choose a home, make a solid offer and don’t look back. If you have selected a good agent, you should feel confident about your decision. If the offer isn’t accepted or they sellers counter and the property no longer meets your terms, move on to the next property knowing that you have gained something from the experience.

Negotiate

Sellers want that are motivated to move due to job relocation, divorce, foreclosure or short-sale might offer you a number of concessions including paying closing costs, conveying furniture or appliances or other things of value. In any event, it is important that whatever is offered makes sense for you. Giving you a houseful of old furniture might be worth less to you than say remodeling a bathroom. We are here to help you qualify for your next home purchase as well as inform and advise you on all the nuances of the market and ever-changing laws. Call us today with any questions!

Phoenix Home Loans Arizona Home Loans Phoenix Homes For Sale Mesa Mortgage Rates Mesa Homes For Sale Great Arizona Schools

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Half Empty... or Half Full?

noreply@blogger.com (Philip Jensen) — Mon, 16 May 2011 19:32:00 +0000

In This Issue...

Last Week in Review: Inflation is heating up, but what does that mean for home loan rates?

Forecast for the Week: Thursday will be an especially busy day when it comes to reports this week, with news on jobs, housing, and manufacturing.

View: Ever experience "brain fog?" Check out three great tips for boosting your brainpower.

Last Week in Review

"Is the glass half empty... or half full?" That question is one many people are debating when it comes to our economy - yes, the economy is still sluggish... but the slow recovery has helped home loan rates improve. So what developed last week...and what was the impact on home loan rates? Let’s take a deeper look.

First, on the inflation front: 6.8%...that's the current year-over-year rate of Producer or Wholesale inflation. And that is hot - very hot! And while Producer or Wholesale inflation doesn't always get passed onto the consumer as evidenced by the relatively benign Consumer Price Index (CPI) inflation readings, at some point one of two things must happen.

Businesses who are burdened with increased costs must pass the increase to the consumer by raising prices, thus boosting consumer inflation.
If businesses aren’t in a position to raise prices because of weak consumer demand, they must absorb the increased costs...thereby lowering earnings and the ability to expand, thus furthering the present slow economic growth.

The takeaway here: One of the Fed's goals for their second round of Quantitative Easing (QE2) was to create inflation and avoid deflation in the hopes of strengthening our economic recovery. It appears that they have been somewhat successful in this goal, as the risks for deflation have somewhat abated. But remember, inflation is the arch enemy of Bonds and home loan rates. If inflation continues to heat up, this could hinder further improvement in home loan rates.

It’s also important to note that inflation in China is also on the rise, and inflation abroad becomes inflation here in the US as we import so many items from China. China's buying of our debt has helped keep our home loan rates relatively low for a long time. Home loan rates would likely move higher if China not only slows buying, but were to start selling some of their near $900 Billion worth of U.S. government debt holdings.

And speaking of our debt, Republicans in the U.S. House of Representatives are increasingly dismissive of Treasury Secretary Tim Geithner's warnings that Congress must raise the debt limit prior to August 2nd or risk economic "catastrophe." This will be an important development to watch in the weeks to come.

The bottom line is that, on the glass half full side of things, home loan rates still remain near some of the best levels we’ve seen this year. If you have been thinking about purchasing or refinancing a home, call or email me to learn more about why now is a great time to benefit from today’s historically low rates. Or forward this newsletter on to someone you know who may benefit.

Forecast for the Week

This week, Thursday will be an especially busy day when it comes to economic reports. Be sure to look for:

A double dose of housing news, first with Tuesday’s news about Housing Starts and Building Permits for April, followed by the Existing Home Sales Report on Thursday.
Job news with Thursday’s weekly Initial and Continuing Jobless Claims Report. Last week’s Initial Claims were 434,000, above expectations of 423,000 and solidly above the 400,000 mark. Staying below 400,000 is so important in order to put a dent in the stubbornly high unemployment rate.
Manufacturing news with Thursday’s Philadelphia Fed Index, which is considered an important indicator of the manufacturing industry.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.

As you can see in the chart below, Bonds and home loan rates were unable to improve past an important technical level and on the hot inflation news. I’ll be watching closely this week to see if Bonds and rates can break through this resistance and improve.

-----------------------

Chart: Fannie Mae 4.0% Mortgage Bond (Friday May 13, 2011)

The Mortgage Market Guide View...

Boost Your Brainpower - and Happiness - with 3 Simple Steps

It's easy to believe that your intelligence is set, meaning there's no way to "boost" your brainpower. However, many scientific studies have proven the exact opposite. A combination of lifestyle adjustments and mental exercises has been shown to not only increase intelligence, but also to improve general brain health and help prevent disorders associated with aging, such as Alzheimer's disease.

According to most neurologists, the key is to stay mentally active, despite your age. The brain is a complex organ, able to create new connections between nerve cells when it is properly stimulated. These connections lend themselves to optimal brain function and increased intelligence.

Whether you're a Generation Xer, a baby boomer, or an octogenarian, the following tips can help boost your mental activity and increase your intelligence:

1. Keep Memorizing. There is no shortage of contemporary studies that show a powerful correlation between a strong working memory and overall intelligence. A good memory has also been shown to slow down mental aging. Ergo, memorizing almost anything is one of the best exercises you can give your brain. Start small by memorizing your shopping list or your daily schedule. Step it up a notch and memorize a poem or two. Take it to another level by learning a musical instrument or a new language. Doing any of these exercises can potentially lead to quick and substantial improvement in your mental sharpness.

2. Get a Hobby. Gardening, bird watching, collecting, flying model airplanes, etc.; taking on any new hobby is good for mental stimulation as well as your overall mood. Finding activities you really enjoy allows you to learn and have fun, simultaneously. It provides both an escape and a passion. All of these traits are components to living a happy and rewarding life, and remaining mentally sharp.

3. Challenge Yourself. One enemy of intelligence and mental sharpness is our propensity to fall into overly rigid, daily patterns. It is one thing to keep a schedule or to plan out the events of your day. What we're talking about is having the exact same routine, nearly every day. Falling into rigid patterns promotes mental passivity, or the opposite of stimulation. So try mixing things up a bit. Challenge yourself by participating in new activities. Join a softball league, a reading club, or even a theater group. At the very least, play around with your daily schedule. The point is that too much regimen can dull the senses.

Start implementing these easy steps today to bring sharpness, clarity, and happiness into your life!

--------------------------

Economic Calendar for the Week of May 16-20, 2011

Remember, as a general rule, weaker than expected economic data is good for rates, while positive data causes rates to rise.

Economic Calendar for the Week of May 16 - May 20

Date	ET	Economic Report	For	Estimate	Actual	Prior	Impact
Mon. May 16	08:30	Empire State Index	May	18.0		21.7	HIGH
Tue. May 17	08:30	Housing Starts	Apr	563K		549K	Moderate
Tue. May 17	08:30	Building Permits	Apr	590K		594K	Moderate
Tue. May 17	09:15	Capacity Utilization	Apr	77.7%		77.4%	Moderate
Tue. May 17	09:15	Industrial Production	Apr	0.5%		0.8%	Moderate
Thu. May 19	08:30	Jobless Claims (Initial)	5/14	420K		434K	Moderate
Thu. May 19	10:00	Existing Home Sales

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Weekly Mortgage Newsletter

noreply@blogger.com (Philip Jensen) — Fri, 13 May 2011 17:42:00 +0000

Mortgage Time
Mortgage Market News for the week ending May 13, 2011

Compliments of
Philip Jensen
AmeriFirst Financial

PHONE:
(602) 492-8393

Phil@JensenTeam.com

Arizona Mortgage Experts

Phoenix Home Search

Mesa Mortgage Rates

Gilbert Homes for Sale

1910 S. Stapley Dr
Suite 209
Mesa, AZ 852104

Events This Week:

Inflation Rose

Jobless Claims Fell

Retail Sales Higher

Manufacturing Mixed

Events Next Week:

Mon 5/16
Empire State

Tues 5/17
Industrial Prod.
Housing Starts

Wed 5/18
FOMC Minutes

Thur 5/19
Existing Sales
Philly Fed
Leading Indicators

Little Change in Mortgage Rates

It was a volatile week for mortgage rates. Troubles in smaller European nations, mixed results for the Treasury auctions, and tame inflation data caused significant movements in rates during the week. These influences offset each other, though, and mortgage rates ended the week nearly unchanged.

Although the Consumer Price Index (CPI) inflation data came in slightly higher than expected on Friday, mortgage rates improved after the news. April CPI increased 3.2% from one year ago, which was the highest annual rate in two and one-half years. Core CPI, which excludes food and energy, increased at a 1.3% annual rate. While Core CPI remained well below the Fed's target range around 2.0%, it was up from 1.2% last month and 0.8% at the end of last year, meaning that the trend has clearly been moving higher.

Inflation is negative for mortgage rates, so the question is why mortgage rates remain at the lowest levels of the year despite rising inflation data. The likely answer is that investors expect that the majority of the increase in inflation has already taken place. Fed officials have maintained that they expect the inflationary effects of higher oil prices to be "transitory", and the recent drop in oil prices has supported the Fed's position. One year ago, oil prices were around $70 per barrel, but they averaged about $110 per barrel in April, an increase of more than 50%. So far in May, oil prices have averaged about $100 per barrel, and investors don't expect that oil prices will rise 50% over the next year. Meanwhile, wage growth, a major factor in inflation levels, has been minimal in recent months. For these reasons, current inflation expectations remain relatively low.

Also Notable:

Weekly Jobless Claims fell sharply from the highest level since August last week
April Retail Sales increased 0.5% from March, showing steady improvement
Plosser stated that inflation and inflation expectations will determine future Fed policy
S&P again downgraded its rating for Greece

Average 30 yr fixed rate:
Last week:	-0.10%
This week:	0.00%

Stocks (weekly):
Dow:	12,700	-50
NASDAQ:	2,850	-25

Week Ahead

Next week, Industrial Production, an important indicator of economic growth, will come out on Tuesday. Housing Starts will also be released on Tuesday. The FOMC Minutes from the April 27 Fed meeting will come out on Wednesday. These detailed notes offer additional insight into the Fed's decisions. Existing Home Sales will be released on Thursday. Empire State, Philly Fed, and Leading indicators will round out the schedule.

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The Endgame Headwinds

noreply@blogger.com (Philip Jensen) — Wed, 04 May 2011 22:08:00 +0000

Philip Jensen

Arizona Mortgage Experts

The Endgame Headwinds

Before we can get to how I think the Endgame of the debt supercycle plays out in the US, we need to quickly survey the current environment, and revisit (at least for long-time readers) a few basic economic themes that I will call the "headwinds" of economic growth. So many leaders in so many countries think that with the right policies they can grow (export) their way out of the problem. As I have written, not everyone can grow their way out of a crisis at the same time. Someone has to buy.

And while the right policies will in fact help, growth is, in my opinion, going to be severely constrained in the multi-year period of the Endgame. But, jumping right to the bottom line here, one way or another we will get through this very difficult period. Really. And my personal view is that in the period following the Endgame cycle we're going to see a very real economic boom, for reasons we will visit briefly in this series and at length over the coming year. I am quite optimistic longer-term, but the flight to get there may be very bumpy if you are not prepared for it. I will try to do my part to help you.

Briefly, for new readers, let me define what I mean by the Endgame, as dealt with at length in Endgame: The End of the Debt Supercycle and How It Changes Everything (www.amazon.com). The US in particular and much of the developed world in general began a cycle of ever-increasing debt in the late '40s, after World War II, both in the private and public sectors. Government began to grow as a percentage of overall GDP in the latter part of this cycle. In addition, politicians created large (well, huge) entitlement programs of pensions and health-care benefits that require significant taxes and, as we shall see, are unsustainable in the our present medium term.

There is a limit to how much money an individual or country can borrow. We all intuitively know this. If you grow your debt faster than your income and your ability to service the debt over a long period of time, people will eventually stop loaning you money. This is true for individuals, businesses, and nations. The end result is a restructuring of the debt (default by one of several means, including serious inflation) or a very reduced standard of living (by previous standards) for a period of time in order to service the debt. For individuals, that may mean cutting off the cable, no eating out, no vacations, etc. For countries it means reduced government programs and benefits, and higher taxes.

And make no mistake. I believe that the situation in the US is becoming urgent all too quickly. We are risking the health of the economic body of the US. While the republic will survive the crisis, the shocks and burdens it will place on all of us will be very great. For those not prepared it will seem like the end of the world, as jobs and safety nets might evaporate without proper restructuring. As I argue, the goal of fiscal sanity is to get the growth of the debt below that of the growth rate in nominal GDP. Failure to do so will result in the US suffering much as Greece or Ireland are today. Ugly.

The 2008 banking crisis showed us the limits of how much individuals can borrow, at least against their home equity. Since then, private debt (except recently for student loans in the US) has begun to shrink. But governments everywhere stepped into the breach by massively borrowing. But even governments, including the US, have a limit. We see that in Greece and Ireland, and are watching the debt crisis unfold in Portugal and Spain as well. It will soon become all too painfully clear in Japan. As I have often noted, Japan is a bug in search of a windshield. Japan is big enough that when it hits its own version of the Endgame, it will shake the world. It will not be pretty. (But there are opportunities for the nimble.)

As we will quickly cover here, the economic environment in which individuals and governments either willingly or are forced by the markets to reduce their borrowing and debt is significantly different from the period where they could create ever-increasing amounts of leverage. I call this period the Endgame. What we think of as normal gets turned upside down. Volatility increases, at a minimum. For many people this will qualify as a true crisis. But if you can see it coming and prepare, you can at least insulate yourself (somewhat) from many of the negative aspects of the Endgame. And volatility and crisis also mean that there will be opportunities for those prepared for them.

Now, let's look at three graphs. The first is familiar to long-time readers. It shows the rise of debt in the US. And even with the recent pullback in consumer debt, because of the enormous government deficits, the rise is still there if we update this chart to last year.

The next two charts come from the Bank of International Settlements. They outline for 12 countries what happens, in terms of the debt-to-GDP ratio, if current spending and tax rates remain unchanged (the top dotted line), what happens if there are efforts to rein in spending with small gradual spending cuts and tax increases (middle line), and what would happen with serious spending cuts and significant tax increases (the lowest line). Some countries, even with measures that could be considered draconian, simply do not recover. While the chart shows what would happen if age-related spending were held constant, most seniors would think that getting ever-smaller pensions and health care would be drastic measures indeed. These countries are in an unsustainable spiral, which means drastic (the word used by the BIS) measures will be needed.

Note that there is only one example of a country that ever saw its debt-to-GDP rise over 150% and did not default, and that is Britain at the height of its empire and power, with long-term rates at a very low level and a completely different investment and bond climate. But notice how many of the countries are now on a path to twice that level in the very near future.

If Something Can't Happen...

There is rule in economics: If something can't happen, it won't happen. That may seem obvious, but so many people think the current linear trend can go on forever. This time is different, we tell ourselves. And I (and some others, like David Walker, Stockman, etc.) are telling you that so many things are on unsustainable paths that changes in present trends, as much as we might not like to think about them, are inevitable. So what we must think about now is what will happen when change is either forced on a country or entered into willingly. Sometimes you have to think the unthinkable.

Look at the projected debt for the US, compiled last year by the Heritage Foundation, based on realistic assumptions, not with rose-colored glasses. This is a chart of something that will not happen. Long before we get ten years of multi-trillion-dollar debt, the bond market will being to require much higher rates than we currently experience, driving up the interest-rate cost as a percentage of tax revenues to very painful levels, forcing cuts in all sorts of things we currently think of as absolutely necessary, like military, education, and Medicare spending. Later on I will put a timeline on this prediction.

One way or another, the budget deficits are going to come down. As we will see later, we can choose to proactively deal with the deficit problem or we can wait until there is a crisis and be forced to react. These choices result in entirely different outcomes.

In the US, the real question we must ask ourselves as a nation is, "How much health care do we want and how do we want to pay for it?" Everything else can be dealt with if we get that basic question answered. We can radically cut health care along with other discretionary budget items or we can raise taxes, or some combination. Both have consequences. The polls say a large, bipartisan majority of people want to maintain Medicare and other health programs (perhaps reformed, but still existent), and yet a large bipartisan majority does not want a tax increase. We can't have it both ways, which means there is a major job of education to be done.

The point of the exercise (reducing the fiscal deficit to sustainable levels) is to reduce the deficit over 5-6 years below the growth rate of nominal GDP (which includes inflation, about which more below). A country can run a deficit below that rate forever, without endangering its economic survival. While it may be wiser to run some surpluses and pay down debt, if you keep your fiscal deficits lower than income growth, over time the debt becomes less of an issue.

GDP = C + I + G + Net Exports

But either raising taxes or cutting spending has side effects that cannot be ignored. Either one or both will make it more difficult for the economy to grow. Let's quickly look at a few basic economic equations. The first is GDP = C + I + G + net exports, or GDP is equal to Consumption (Consumer and Business) + Investment + Government Spending + Net Exports (Exports – Imports). This is true for all times and countries.

Now, what typically happens in a business-cycle recession, as businesses produce too many goods and start to cut back, is that consumption falls; and the Keynesian response is to increase government spending in order to assist the economy to start buying and spending, and the theory is that when the economy recovers you can reduce government spending as a percentage of the economy – except that has not happened for a long time. Government spending just kept going up. In response to the Great Recession, government (both parties) increased spending massively. And it did have an effect. But it wasn't just the stimulus, it was the absolute size of government that increased as well.

And now massive deficits are projected for a very long time, unless we make changes. The problem is that taking away that deficit spending is going to be the reverse of the stimulus – a negative stimulus if you will. Why? Because the economy is not growing fast enough to overcome the loss of that stimulus. We will notice it. This is a short-term effect, which most economists agree will last 4-5 quarters, and then the economy may be better, with lower deficits and smaller government.

However, in order to get the deficit under control, we are talking on the order of reducing the deficit by 1% of GDP every year for 5-6 years. That is a very large headwind on growth, if you reduce potential nominal GDP by 1% a year in a world of a 2% Muddle Through economy. (And GDP for the US came in at an anemic 1.75% yesterday, with very weak final demand.)

Further, tax increases reduce GDP by anywhere from 1 to 3 times the size of the increase, depending on which academic study you choose. Large tax increases will reduce GDP and potential GDP. That may be the price we want to pay as a country, but we need to recognize that there is a cost to growth and employment. Those who argue that taking away the Bush tax cuts will have no effect on the economy are simply not dealing with either the facts or the well-established research. Now, that is different from the argument that says we should allow them to expire anyway

Increasing Productivity

There are only two ways to grow an economy. Just two. You can increase the working-age population or you can increase productivity. That's it. No secret sauce. The key is for us to figure out how to increase productivity. Let's refer to the last equation.

The I in the equation is investments. That is what produces the tools and businesses that make "stuff" and buy and sell services. Increasing the government spending, "G", does not increase productivity. It transfers taxes taken from one sector of the economy and gives them to another, with a cost of transfer, of course. While the people who get the transfer payments and services certainly feel better off, those who pay taxes have less to invest in private businesses that actually increase productivity. As I have shown elsewhere, over the last two decades, net new jobs in the US have come from business start-ups. Not large businesses (they are a net drag) and not even small businesses. Understand, some of those start-ups become Google and Microsoft, etc. But many just become small businesses, hiring 5-10-50-100 people, but the cumulative effect is growth in the economy and productivity.

Now, if you mess with our equation, what you find is that

Savings = Investments.

If the government "dis-saves" or runs deficits, it takes away potential savings from private investments. That money has to come from somewhere. Of late, it has come from QE2, but that is going away soon. And again, let's be very clear. It is private investment that increases productivity, which allows for growth which produces jobs. Yes, if the government takes money from one group and employs another, those are real jobs, but that is money that could have been put to use in private business. It is the government saying we know how to create jobs better than the taxpayers and businesses we take the taxes from.

This is not to argue against government and taxes. There are true roles for government. The discussion we must now have is how much government we want, and recognize there are costs to large government involvement in the economy. How large a drag can government be? Let's look at a few charts. The first two are from my friend Louis Gave, who will be speaking at my conference this weekend. This first one is the correlation between the growth of GDP in France and the size of government. This chart shows the rate of growth in GDP and the ratio of the size of the public sector to the private sector. The larger the percentage of government in the ratio, the lower the growth.

I know, you think that is just the French. We all know their government is too involved in everything, don't we. But it works in the US as well. The chart below shows the combined federal, state and local expenditures as a percentage of GDP (left-hand scale, which rises as the line falls) versus the 7-year structural growth rate, shown on the right-hand side. And you see a very clear correlation between the size of total government and structural growth. This chart and others like it can be done for countries all over the world.

The chart needs a little set-up. It shows the contribution of the private sector and the public sector to GDP. Remember, the C in the equation was private and business consumption. The G is government. And G makes up a rather large portion of overall GDP.

The top line (in dark blue) is real GDP per capita. The next line (yellow) shows what GDP would have been without borrowing. So a very real portion of GDP the last few years has come from government debt. Now, the green line below that is private-sector GDP. This is sad, because it shows that the private sector, per capita, is roughly where it was in 1998. The growth of the "economy" has been government.

Is it any wonder that we have no net new jobs over the last decade? I get that there have been two recessions, but in an effort to appear to be "doing something," to "feel your pain," government is slowly sucking the air out of the room. Not all at once. Just a bit at a time.

And it shows up in worker pay. The average worker has not seen their pay rise in real terms in almost 15 years. If they have a job. In fact, for the last decade, they LOST 5%.

Do you want more tax revenues so we can have more government services like health care? We have to grow the private economy. If we tax the private economy as it is now, that will just reduce the growth in the private economy and slow or reduce the growth of jobs. There is simply no way to get around that fact.

I will close here and start with part two next week. But the short take-away? The fiscal deficit and the national debt are a cancer on our economic body. They threaten to destroy the economic body of the republic. As a conservative, simply writing the words "tax" and "increase" in the same sentence makes me nervous. But I am even more afraid of what will happen if we do not get the deficit under control over time (next week we'll explore why we cannot do it all at once). Sometimes, when they have cancer, people take drugs they would not normally want to be in the same zip code with, in order to increase their chances of surviving. But those drugs have side effects, some of them quite severe and long-term.

How we solve this crisis will determine the nature of the Endgame. But that is for next week.

Toronto, Cleveland, LA, Philadelphia, Boston, and Italy

I am in La Jolla with about 450 attendees at my annual Strategic Investment Conference, co-hosted with Altegris Investments. It is a fabulous, sold-out event. It is truly one of the highlights of my year, joining so many old and new friends for a few days. And the intellectual conversation? Wow. We are recording the panels and hope to make them available at some point.

I fly to Toronto on Sunday for a quick speech, then back to Dallas, on to Cleveland for a night, then right off to Rob Arnott's annual conference in LA. Another very impressive line-up and one that I am privileged to be allowed to participate in. Then home for a weeks to catch my breath.

I will be in Philadelphia Tuesday May 24 to moderate a panel and listen to a serious gathering of speakers at the 29th annual Monetary and Trade Conference, where the topics are "Is Housing Ready for a Rebound?" and "QE2, Housing and Foreclosures: Are they Related?" Philly Fed president Tom Hoenig, Chris Whalen, Michael Lewitt, Paul McCulley, William Poole, and Gretchen Morgensen, among others. To find out more you can go to http://www.interdependence.org/Event-05-24-11.php. Then it's on to Boston with some friends for fun (and a board meeting), then straight to Italy and a train to the little village of Trequanda in Tuscany, where vacation for me is staying in the same place for a few weeks, writing and thinking, and having friends show up. The kids will be there for the beginning, and Tiffani and I will make it a working vacation after that. And then I'm off to Kiev, Geneva, and London with my youngest son in tow; but more on that later.

John Mauldin John@FrontlineThoughts.com

Thoughts From the Frontline and JohnMauldin.com is not an offering for any investment. It represents only the opinions of John Mauldin and those that he interviews. Any views expressed are provided for information purposes only and should not be construed in any way as an offer, an endorsement, or inducement to invest and is not in any way a testimony of, or associated with, Mauldin's other firms. John Mauldin is President of Business Marketing Group. He also is the President of Millennium Wave Advisors, LLC (MWA) which is an investment advisory firm registered with multiple states, President and registered representative of Millennium Wave Securities, LLC, (MWS) member FINRA, SIPC. MWS is also a Commodity Pool Operator (CPO) and a Commodity Trading Advisor (CTA) registered with the CFTC, as well as an Introducing Broker (IB) and NFA Member. Millennium Wave Investments is a dba of MWA LLC and MWS LLC. This message may contain information that is confidential or privileged and is intended only for the individual or entity named above and does not constitute an offer for or advice about any alternative investment product. Such advice can only be made when accompanied by a prospectus or similar offering document. Past performance is not indicative of future performance. Please make sure to review important disclosures at the end of each article.

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Big Ben's Historic Chime

noreply@blogger.com (Philip Jensen) — Mon, 02 May 2011 17:23:00 +0000

Provided to you Exclusively by Phil Jensen

Phil Jensen
Senior Mortgage Consultant
Amerifirst Financial
Office: 480-682-6613
Cell: 602-692-7445
Fax: 480-374-6987
E-Mail: Phil@JensenTeam.com
Website: www.PhilipJensen.com

For the week of May 02, 2011 --- Vol. 9, Issue 18

In This Issue...

Last Week in Review: Fed Chairmen Ben Bernanke spoke...and I was listening. Learn what he said, and what this could mean for home loan rates.

Forecast for the Week: The job market labors on, but will Friday’s Jobs Report for April be painful?

View: Ever wondered how healthy your neighborhood is? There’s an easy way to find out!

Last Week in Review

"SLOW AND LOW, THAT IS THE TEMPO..." Just like these lyrics from the "Beasties Boys" song, slow and low have been the tune for the Bond market recently, as we’ve seen our slow economy cause home loan rates to move lower recently. What’s been happening, and where are the economy and rates headed? Read on to learn more.

The search for answers begins with last week’s regularly scheduled meeting of the Federal Open Market Committee (FOMC), which was followed on Wednesday by the historic, first-ever Fed Chairman's Press Conference. Here’s a summary of the main points that Fed Chairman Ben Bernanke shared:

Bernanke said the downtick expected in Gross Domestic Product (GDP) is "transitory," and that the economy's temporary sluggishness is somewhat a result of high Oil prices, which he believes is also temporary in nature.
Inflation has picked up in recent months but long-term inflation remains subdued.
Bernanke was also crystal clear in saying the Fed will complete the $600 Billion of Quantitative Easing 2 (QE2) purchases through June, as originally planned.

So what does all of this mean for home loan rates in the short and long term?

An important factor to keep in mind is the US Dollar, which continues to decline. With QE2 and the dollar printing presses going full steam through the end of June - we should expect the "greenback" to erode further, and how the US Dollar performs after QE2 may have a meaningful effect on the Bond market and home loan rates. A persistent weak US Dollar is ultimately not good for Bonds or home loan rates, as a continued decline would make US dollar denominated assets like Treasuries and Mortgage Bonds (to which home loan rates are tied) less attractive. A weak Dollar is also inflationary, as it makes our exports more expensive.

The bottom line is this: In the short term, Bond prices are close to a position to break out higher, which would lower home loan rates further still. However, in order for this to happen, the Bond must break above a tough level of technical resistance. Longer-term, how the economy performs post-QE2 will determine which way Bonds and rates are headed at that point, but it’s most likely they’ll trend higher.

If the economy, which still has stubbornly high unemployment and millions out of work, doesn't pick up on its own post-QE2, then the Fed will continue its accommodative monetary policy as much as it can to avoid inflation. This is to support the economy and push Stocks higher still...but this would have a further negative effect on the US Dollar, as well as Bonds and home loan rates.

If you have been thinking about purchasing or refinancing a home, call or email me to learn more about why now is a great time to benefit from today’s historically low rates. Or forward this newsletter on to someone you know who may benefit.

Forecast for the Week

Job news is the heavy hitter this week, but whether the week is full of "labor pains" remains to be seen. Look for:

Thursday’s weekly Initial and Continuing Jobless Claims Report. Last week’s Initial Claims sadly climbed to 429,000 for the week, well above both expectations and that psychologically important 400,000 barrier. Unfortunately, the pain in the labor market has not been "transitory". And seeing Claims rise back above 400,000 is not a good thing, as Initial Jobless Claims are a leading indicator on the health of the economy.
The Labor Department’s official Jobs Report for April on Friday.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.

As you can see in the chart below, Bonds and home loan rates have improved due to the slowing in the economy. I’ll be watching closely to see if this trend continues.

-----------------------

Chart: Fannie Mae 4.0% Mortgage Bond (Friday Apr 29, 2011)

The Mortgage Market Guide View...

Know Thyself. And Thy Community!

Whether you’re looking to make local business decisions, integrate into a new neighborhood, or find volunteering opportunities where there is a need, it’s important to be informed about the health of your community.

Fortunately, finding that information is quick and convenient when you visit http://www.countyhealthrankings.org.

This website brings together 50 reports through the collaboration of the Robert Wood Johnson Foundation and the University of Wisconsin Population Health Institute. The result is a health ranking of each state’s counties.

How Does Your Community Rank?

1. Simply visit http://www.countyhealthrankings.org.
2. Hover your mouse of the map of the U.S. and click on your state.
3. Click on your county once the state map appears on your screen.

It’s that easy. With just a few clicks, you can see your county’s overall ranking as well as important local statistics related to:

Unemployment
Education
Smoking and drinking
Access to recreational facilities
Air pollution
Poverty
Motor vehicle death rates
Diabetes
And much more!

Check out your county today - and share this information with friends, family members, and co-workers in your community!

--------------------------

Economic Calendar for the Week of May 2-6, 2011

Remember, as a general rule, weaker than expected economic data is good for rates, while positive data causes rates to rise.

Economic Calendar for the Week of May 02 - May 06

Date	ET	Economic Report	For	Estimate	Actual	Prior	Impact
Mon. May 02	10:00	ISM Index	Apr	59.7		61.2	HIGH
Wed. May 04	08:15	ADP National Employment Report	Apr	200K		201K	HIGH
Wed. May 04	10:00	ISM Services Index	Apr	57.3		57.3	Moderate
Thu. May 05	08:30	Jobless Claims (Initial)	4/30

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Arizona Water Ski Foreclosure

noreply@blogger.com (Philip Jensen) — Tue, 26 Apr 2011 22:57:00 +0000

Property Comments:

UNIQUE ARIZONA HOME ON PRIVATE WATER SKI LAKE, WATERFRONT LOT WITH RESORT-LIKE BACKYARD, ENJOY WATER SKIING, WAKE BOARDING, TUBING, KAYAK/ROWING. CUSTOM DOCK & PRIVATE BOATHOUSE W/LIFT, SEPARATE SKI/CRAFT ROOM, BOAT TRAILER STORAGE AREA, CUSTOM HOME WITH PRIVATE MASTER SUITE UPSTAIRS,SEPARATE HIS/HER WALK-IN CLOSETS AND SNAIL SHOWER, ENTERTAINERS DREAM KITCHEN THAT FEATURES DOUBLE ISLANDS, PANTRY W/WINE RACK, UPDATED APPLIANCES INCLUDING ICE MAKER & BI REFRIGERATOR, ALL ROOMS ARE SPACIOUS AND BRIGHT, TOO MANY FEATURES TO LIST.

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Top 10 Arizona Home Buying Mistakes

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