Rates Searching For A Direction...

Roller Coaster Ride Continues... After getting hammered earlier in the week, mortgage rates have recovered most of their early week’s losses but continue to search for a true direction. Our “warriors of Wall Street” are not making things any easier as their opinion on the direction of the economy changes with the changes in our temperatures. While many of them had visions of grandeur that the economy was finally recovering they were hit with yesterday’s retail sales numbers and weekly unemployment claims. Retail sales actually fell in December (yes the Holiday shopping period) by .3% after seeing sales rise by a meager 1.8% in November. Unemployment claims rose last week by a surprising...OK surprising to our “warriors” but not to those who live in the real world….11,000. It was not surprising to me as I am sure many who were looking for jobs going into November took sales jobs at many retailers in hopes to land long term employment. The fall in sales did not help their chances of gaining permanent positions and once again found themselves looking for employment. The biggest fear on Wall Street is the specter of inflation. However, it is virtually impossible to have inflation when sales are down and over 17% of the population is either unemployed or underemployed. However, buyers should not take chances with interest rates. Our “warriors” could drive them notably higher at any time. It is a great time to buy while we are experiencing historically low rates and some of the lowest housing prices we have seen in years!!!