patrick.net

Dollar is even gaining strength:
http://www.marketwatch.com/story/treasurys-dollar-edge-up-after-jobless-claims-2012-10-18

http://www.sacbee.com/2012/10/18/4920901/bankrate-mortgage-rates-continue.html

... and there it is. Mortgage rates heading back toward 4%.

F*ck you Ben!

Shorts covering. Still, last month or two, seeing new lows on bank rates I'd expect we had a storm of refinancing.

SFace says

QE3 specifically buys mortgage backed securities, not US treasuries. While the 10 year treasury influence rates, the 40B monthly purchase, specific to mortgages will keep mortgage rates low.

Not arguing with your facts, but this seems like a distortion without precident.

B.A.C.A.H. says

Not arguing with your facts, but this seems like a distortion without precident.

Absolutely. I do not think that anyone disputes that. Ben Bernanke himself has stated openly that he wants to drive the housing price "recovery" as he sees it as being key to fixing the economy. He actually said that he wants prices up to create the wealth effect so that people are willing to borrow & spend again. Yup, that's the grand master plan. Aren't you glad that we have such visionaries at the helm?

bmwman91 says

Absolutely. I do not think that anyone disputes that. Ben Bernanke himself has stated openly that he wants to drive the housing price "recovery" as he sees it as being key to fixing the economy. He actually said that he wants prices up to create the wealth effect so that people are willing to borrow & spend again. Yup, that's the grand master plan. Aren't you glad that we have such visionaries at the helm?

Bernanke basically put his foot to the floor, and the printing press is at full steam, and nothing is happening. Anyone ever drive a car where you floor it and it goes nowhere? It's a very disappointing feeling.

SFace says

Nope, just ran through Q3 reports today, FX gains 3.2% in Canada and around 2.8% in Japan just off the top of my head. for the quarter ended Sep 30th. It was a weak weak recent quarter for the dollar.

Ahem.

The dollar index [S; dxy], which measures the U.S. unit against a basket of six major currencies, rose to 79.159 from 79.095 before the data and 79.022 in North American trade late Wednesday. The euro EURUSD +0.0142% slipped to $1.3098 from $1.3121 Wednesday.

everything says

Still, last month or two, seeing new lows on bank rates I'd expect we had a storm of refinancing.

30-year fixed: 3.62% -- up from 3.59% last week (avg. points: 0.41)

15-year fixed: 2.91% -- up from 2.88% last week (avg. points: 0.28)

5/1 ARM: 2.72% -- up from 2.68% last week (avg. points: 0.40)

SFace, I'm going to have to ask you to not use personal insults in this thread. I've deleted a few of your post already. Keep it civil. I don't mind disagreement, but don't take it to the gutter.

You can restate your position on the dollar gaining (or losing) strength, but don't use personal insults or I'll delete it again.

Thank you.

SFace says

Banks close on Columbus day. The adjusted index is at June 2012 level, whatever that means. My interpretations is sales will be pretty strong in Nov and Dec with around 8-10% YOY increase in sales volume

That might be true, but purchase mortgage applications have been down YOY for the past 4 years:

This isn't some short term trend like you're trying to paint it, it's a reflection of how out of reach homes are in terms of price and "affordability" for the middle class.

War says

Pending sales cratered nationally for September 2012.

It's a long way down, price-wise.

Yeah I was bullish on housing after Bernanke announced he would do QE infinity. But after seeing how the market actually reacted, it's like someone putting the accelerator to the ground in their car, and it only moving a few feet. Not exactly the reaction I expected.

SFace says

First, it's seasonal.

A 20% drop would be the biggest August-September drop in 4 years. I would have to disagree that the drop is purely seasonal.

Goran_K says

Mortgage rates heading back toward 4%.

Actually I see that as a good sign. This refi madness must stop to gauge the correct movement of the market. Cash in hand will come really handy as prices will head down with the spike in interest rates.

bubblesitter says

Actually I see that as a good sign. This refi madness must stop to gauge the correct movement of the market. Cash in hand will come really handy as prices will head down with the spike in interest rates.

The 10 year has risen month over month since July:

That won't only have an effect on rates, but on investors who are seeking a less volatile investment. If it goes over 2 like I suspect, that could be another dagger into housing.

30 year fixed would go back to 3.75 or 4.00 par rates.

Goran_K says

That won't only have an effect on rates, but on investors who are seeking a less volatile investment.

Yes. Investors. Ideal situation would be to have them a feeling on less profit and market will enter into normal phase. Hell,I'll buy any property at any given day,that has not been eyed by an investor.

It really should not matter, the buying flurry has already occurred with the low rates, now you see lots of junk left on the market, while those who were treading water either refinanced or are still treading water. If the government is injecting 40 B a month via MBS, someone will get their hands on that money somehow, and buying will continue unabated no matter what the rates.

Rate's don't matter all that much, we've proven that already, it's the unlimited credit that drives the market, so what prices may slide a bit to compensate, interest rates are not going anywhere for years.

bubblesitter says

Yes. Investors. Ideal situation would be to have them a feeling on less profit and market will enter into normal phase. Hell,I'll buy any property at any given day,that has not been eyed by an investor.

Well hedge funds are already jumping out of housing with the yields where they are now. I guess being a landlord isn't as profitable as people say.

everything says

Rate's don't matter, it's the unlimited credit that drives the market,

Didn't they try that already?

Didn't they try that already?

If you don't succeed the first time, try, try again?

everything says

If you don't succeed the first time, try, try again?

At $10 trillion a try?!

You guys just don't get it, the government is picking up the tab here. It's really no different than Solyndra.

Oh, it's the bear thread :)

Didn't even get an email from Redfin today. No new properties 350k and under along the 101 corridor or Hollywood.

I have come to the conclusion, at the moment, the only way to get a good deal in El Aye is at the courthouse steps.

everything says

You guys just don't get it, the government is picking up the tab here. It's really no different than Solyndra.

Solyndra is a drop compared to "trying" to create another credit bubble.

everything says

It really should not matter, the buying flurry has already occurred with the low rates, now you see lots of junk left on the market, while those who were treading water either refinanced or are still treading water. If the government is injecting 40 B a month via MBS, someone will get their hands on that money somehow, and buying will continue unabated no matter what the rates.

Rate's don't matter all that much, we've proven that already, it's the unlimited credit that drives the market, so what prices may slide a bit to compensate, interest rates are not going anywhere for years.

Question is where they use that 40 B. If I were a banker who dips a hand in it, I would go speculate the oil instead of purchasing junk houses. Easy money. This is similar to the fact that the treasury note rates actually RISES while Fed was officially using QEs to purchase the notes. The treasury rates only decreased BEFORE the QEs.

Mobi says

Question is where they use that 40 B. If I were a banker who dips a hand in it, I would go speculate the oil instead of purchasing junk houses. Easy money. This is similar to the fact that the treasury note rates actually RISES while Fed was officially using QEs to purchase the notes. The treasury rates only decreased BEFORE the QEs.

Someone who understands the dynamics of investing. Kudos.

Well well well.... from today:

The S&P 500 lost 1.6%. The Dow Jones Industrial Average dropped 205 points, or 1.5%. The Nasdaq posted the steepest declines, falling 2.2%.

Quite a huge drop after earnings reports came out. Are we still in a recovery or going into recession again?

muahahaahaha with Bernanke at the helm all you doomers are DOOMED. With masterstrokes he guides the great NAR ship higher and higher into heaven taking all wise house buyers with him to money nirvana!!! The all powerful all knowing FED cannot fail to salvage this mighty economy levitating the stock market into a golden time!!!. GET READY TO PARTY SHOOBAZOOOO.

Yup says

Europe depression, China Crash landing, US recession/depression.

Housing prices go up during depressions, really they do!

Poor earnings reports, historically low mortgage application index, and 20% drop in sales volume month over month, I'm not sure that Ben can print the housing market out of the gutter. I mean he literally told the entire country he's going to put his foot down on the pedal connected to the printing press and the market responded by going into idle.

Thanks for educating me, but I thought the 40B MBS was for RE speculating, not the broader commodities market.

It really should not matter, the buying flurry has already occurred with the low rates, now you see lots of junk left on the market, while those who were treading water either refinanced or are still treading water. If the government is injecting 40 B a month via MBS, someone will get their hands on that money somehow, and buying will continue unabated no matter what the rates.

Rate's don't matter all that much, we've proven that already, it's the unlimited credit that drives the market, so what prices may slide a bit to compensate, interest rates are not going anywhere for years.

Question is where they use that 40 B. If I were a banker who dips a hand in it, I would go speculate the oil instead of purchasing junk houses. Easy money. This is similar to the fact that the treasury note rates actually RISES while Fed was officially using QEs to purchase the notes. The treasury rates only decreased BEFORE the QEs.