FINAL GDP will be reported tomorrow morning along with the weekly jobless claims so the market could move dramatically either direction...all before pricing comes out for mortgages. Rates will likely move in one direction or another vs. hold steady.
30 year fixed loans are at 5.25% RANGE...which is AWESOME.
FEDs announced some notes from their meeting this afternoon. The high points: they feel that the downturn in the economy is slowing...and they feel that "deflation" is no longer a threat.
NOTE: Much of the apparent "deflation" signals were due to lowered delivery cost from the super low energy cost this winter. (Remember when oil was at $27/barrel). It was an interesting twist..."inflation" was a threat last year and many corporations were on super "efficient" delivery models...then the cost to produce fell and with the efficiency: prices stabilized and retreated.
Feds announced that they feel "inflation" is not a threat in the short term either.
YES: at one point there WILL be inflation...and it could be HUGE. An economy can not just "print" a trillion dollars worth of money without diluting the money supply. Remember: at one point we will have to pay the agreed upon "yields" for the treasury notes that we are selling. If TOO many notes are called due at one time: it would simply crash the economy. Remember: the only way to pay the return on cashed in t-notes is to sell more t-notes. The hope is people will buy more than they sell back to us.
The most interesting FED news: they will not make any changes to the current "Mortgage Backed Security" purchase program for now. Look for the report tomorrow to see how and how much they spent on the bonds this week.
FED funds rate will not move and is still going to be at 0.0-0.25% range. The dollar actually rose a little bit on this news...and oil dropped 57 cents by the end of the day.
Dow lost 23 points...
Happy day,
