Update #3/ Week of February 15, 2010

Good Morning Everyone and Happy Wednesday! Today’s fractional gains in equities are impressive in light of the rally stocks enjoyed yesterday. The Dow ended the day yesterday with a near 170 point gain! Even better, credit markets improved throughout the day, too! Some of our investors repriced in the afternoon, some didn’t, but we’re pretty much back to where we were yesterday morning on today’s rate sheet. Equities seem to have pocketed the gains from yesterday, and a flat market seems to be in order for today.

Today’s market scene is opposite of yesterday’s . . . gold is down, oil prices are flat (were down earlier), the dollar is showing considerable strength and equity and credit markets are basically flat. Everyone seems to be taking a breather from yesterday’s action. Our pop in stock indices helped to fuel market rallies in Asia and Europe as Asian stock markets in particular rallied nearly 3%.

Housing starts data for January reported this morning a 2.8% rise month-over-month, besting estimates. Building permits, however, fell 4.9% m-o-m, a bit of a surprise to analysts. Much is being made of this report this morning in the financial news, but the housing industry doesn’t really need new houses . . . there’s plenty of inventory out there waiting to be sold to keep us busy for the next several years. Many of those interviewed this morning are pointing toward tax incentives for first time home buyers as a reason for this rise in housing starts. One question, will the tax incentives still be around when these homes are completed? That’s yet to be seen.

I will be coming back to you soon with some updates to our policy for GFE and new disclosures. I want to get these rates to you so we can get some loans locked today. I will be here all day, call me here or email me with your loan scenario or pricing questions . . . and have a terrific Humpday!