Mortgage bond prices remained nearly unchanged last week holding mortgage rates steady. Trading remained extremely volatile with daily movements in discounts points often exceeding 3/4. Much of the volatility in bonds was tied to the stock market where the Dow Jones Index rose by 933 points only to fall 733 later in the week. Trading in the financial markets remains in disarray as governments around the globe grapple with the credit crisis than has spilled over into most facets of their respective economies. One bright spot on the horizon is the continued decline in oil prices. For the week, interest rates on government and conventional loans fell by 1/8 of a discount point.
Fed Chairman Bernanke's testimony to Congress will likely be the most important event this week. The financial markets remain volatile amid uncertainty. Expect the up and down trading pattern to continue.
Are we headed toward a "Depression" ?
- In the the Great Depression 1300 Banks failed - only 13 banks have been taken over by the FDIC this year.
- Unemployment was 24% back then and is currently around 6%.
- From mid 1929 to 1932 the Dow dropped 90% - lately it has been down roughly 30%
- In 1933 when FDR took over 44% of mortgages were in default. In the 2nd quarter this year only 6% of all mortgages were delinquent.WR Starkey Mortgage - A different kind of company...where people come first!Kurt Gonzalez
Senior Loan Officer
5055 W. Park Blvd #300
Plano, TX 75093 Work: 972-985-0000
Fax: 972-985-8282 kurt@kurtgonzalez.com www.kurtgonzalez.com
