The FOMC left rates holding at 5.25%.? This is the longest pause in 9-years.? They indicated they are still more worried about inflation than the slowing economy.? Furthermore, they are still holding to the belief that the problems in the housing will not spill over into the general ecnomony.? That is not my feeling.?

Two big stories from Bloomberg. The first is about shares dropping on Countrywide and IndyMac. Investor demand is drying up as the sub-prime woes spread to the Alt-A market. Here is the link. The second is about Wells Fargo and others not making loans to even those with good credit or those who don’t document [Read More…]

The treasury market has seen a big drop in yields. The 10-year which affects mortgages and CDs more than anything else has dropped over 30 Basis Points, currently at 4.77%. Good for mortgages, not so good for CDs. The CD rates have come down, but thankfully only 10 – 15 Basis points. At this point [Read More…]

From Wescorp: “Inflation Moderate, Housing starts up – CPI was slightly higher than expected at 0.2%. The report showed that energy prices fell, gas prices dropped, food prices rose, housing costs rose, apparel dropped and autos were unchanged. Core CPI (ex food & energy) was also 0.2% bringing the y-o-y reading to 2.2%. Builders unexpectedly [Read More…]

The Office of the Comptroller of the Currency (OCC) has created a new website with information on National banks. It also gives you a mechanism to file a complaint. Non-national banks, state chartered banks, savings & loans, etc. are not regulated by the OCC so it gives you some other agencies to contact if your [Read More…]

Today the FOMC left the overnight lending rate that banks make to each other at 5.25%. This is the eighth time they have not changed the rate. The last time rates were changed was last year on June 29, 2006. They cited the concern that inflation has not decreased as much as they would like. [Read More…]

Here is an update on treasury yields, “The 2-year yield is down to 4.82%, the 5-year 4.90%, and the 10-year is up 12/32s to yield 5.03%. That 10-year yield is down a whopping 30 basis points from where it was just two weeks ago.” The fact is the underlying conditions haven’t changed. The media can [Read More…]

Bear Sterns bailed out one of its Hedge Funds to a tune of about $3.2 Billion dollars.? And even word there may be need for a second bail out.? This is due to many sub-prime loans going into default. The recent rise in rates compounds the problem because many people hoping to refinance are facing [Read More…]

Updated 9:42 AM PST — I found this article on Bloomberg. Subprime Crash Squeezes Out First-Time Home Buyers RealtyTrac indicated May had a 90% rise in forclosures over last May.? These higher rates certainly will not help the housing market. The longer the rates stay at these levels, the tougher it will be.? If those [Read More…]

Here is an article about pressure that the Fed is feeling to raise rates. This isn’t the most likely scenerio in my book, but here is the information so that you can form your own opinions. Fed Faces Pressure to Raise Rates, Options Show. If the Fed were to raise rates, you would probably see [Read More…]