Update #1/ Week of March 01, 2010

Good Morning Everyone and Happy Monday – first day of the week, first day of a new month! We’re back to a normal Monday trading pattern . . . the stock market is up, commodities are flat, and thankfully, the credit markets are holding their own. The stock market is picking up some momentum from the Asian markets’ start to the week. The Hang Seng (Hong Kong’s stock market) was up earlier this morning over 400 points! The dollar is strong today, which typically means a softer equity market, but it does help the credit markets keep stable -- they are just slightly worse than where they closed on Friday.

The Dow last week lost about 75 points and we are just about at that level in the positive on the Dow as I write . . . which means we are almost to the point exactly where we closed on Feb the 19th . . . 6 days of trading with nothing to show for in equities. However, rates have made quite an improvement in those same 6 days. Stocks are rallying on some M&A activity going on today . . . a trend not seen in quite some time, but has been the case the last couple weeks.

Equity markets are dealing with a mixed bag of economic news this morning. The first economic news release was the consumer spending report for January which showed a 0.5% increase, just ahead of the 0.4% increase analysts were expecting. Core personal consumption was flat from the prior month. However, January personal income only rose 0.1%, quite a bit less than the 0.4% for which analysts were looking. The ISM Manufacturing Index for February came in at 56.5, below the 57.9 widely anticipated and a bit less than the 58.4 posted in January. Construction spending for January dropped 0.6% -- in line with expectations.

In Chicago we like March . . . we say “March comes in like a lion and goes out like a lamb.” We look forward to our March here being quite an improvement from February as everyone now seems to have a grip on this new GFE and rates are really good right now. FTHB’s tax credit is still good for a short time (although it’s almost certain that it will have to be extended). I’m in the office all day today if you need me. Call me or email me with your loan scenario or pricing questions. Have a terrific Monday and a very profitable week!