Update #1/ Week of July 27, 2009-VOLATILITY CONTINUES

Good Morning Everyone and Happy Monday! Well, if you’re waiting for rates to come back down, maybe it’s not such a happy Monday. All the talk in the financial news is about the huge run up that we’ve seen in the stock markets in the last 2 weeks. The Dow spiked 11% in 10 business days. Certainly the majority of prognosticators are calling for some kind of a pull back, and this should see money flow into credit markets. This isn’t happening today though, the stock market is slightly off, but credit markets are losing ground also, so far…

This week we’ll see a huge auction of Treasury Notes which is going to compete with the MBS’s for the investors’ dollar. Also, as compared to the last three weeks, we’ll see a good portion of the companies which haven’t reported earnings do so this week. It’s is going to be volatile once again all week, put your seat belts on.

The stock market headed south right out of the gate, but reversed course when a report of the new home sales for June became public. New home sales rose to 384,000 -- well above the anticipated 352,000. That’s the highest number since November, and much higher than the 346,000 from last month. This is good news for the housing market and is probably a reflection of the tax incentives for new home buyers and drastically reduced prices. Prices are still dropping, but sales have picked up recently.

Our pricing is almost identical to Friday’s, so at least we haven’t lost much ground so far. I’ll be here in the office all day if you need me. I will be out in the field tomorrow visiting accounts. I will send out rate sheets from my home office, but will be available on my cell phone the rest of the day. Have a terrific Monday and a very profitable week!