Update #3/ Week of November 23, 2009

Good Morning Everyone and Happy Wednesday! As Templeton would say, we have “A Veritable Smorgasbord” of economic news this morning with apparently few traders on the floor to digest it all. Stock markets may have rallied excitedly if there were someone there to cheer the rally. Good thing for us because credit markets, though a bit lower, could have really suffered much indigestion this morning. Our rates are about .25 better in rebate than they were yesterday, mostly due to yesterday afternoon’s rally in credit markets.

Thursday’s weekly initial jobless claims report was bumped up a day due to the holiday. This morning we learned that 466K initial jobless claims occurred last week, which is way down from the previous week’s number of 505K (seasonally adjusted) and below expectations of 500K. Pretty exciting news, really. You’d expect this on a shortened week, like this week, but not a normal week like last week. This is the first drop below 500K in over 12 months! Continuing claims dropped nearly 20K, too at 5.42M, below expectations of 5.57M.

In other positive news this morning in regards to economic recovery, personal income for October increased .2% -- besting the .1% anticipated. Personal spending was up .7% in October – besting the .5% anticipated. Core PCE (personal consumption expenditures) increased .2% in October, better than the .1% expected. Just a barrage of good news this morning . . . and normally you’d see the stock market taking off like a rocket – but it continues. New home sales figures for October showed an increase of 6.2% from Sept. to an annualized rate of 430K – topping expectations of 404K.

Oil prices were down early in trading, but once the inventory report came out with a rise in inventories, prices moved higher. The dollar is weak again today and gold is setting new highs . . . again. The results of a Treasury auction of 7-year T notes will be released in ½ hour or so. That may have a positive affect on credit markets.

If you want to lock a loan this morning . . . hurry. My pricing desk will be closing down around 1 PM. There will be no rate sheets on Friday, although we will be open, we will be running on a skeleton staff. Have a terrific Wednesday and a wonderful Thanksgiving with your friends and family. I’ll be coming to you next on Monday the 30th.