Posts

Why The Fed Probably Can Never Raise Interest Rates

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Paul Volcker was the 6 foot, 7 inch tall Fed Chairman who raised the Fed Funds Rate to 20% in 1980 and shoved the United States into a massive recession. As a reminder, the Fed Funds Rate is the rate that banks charge each other to borrow “reserves” overnight, and it is currently 0% – […]Read More

What Are “Interest Rates?” Do They All Move In Unison?

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This is from a training module we just updated for our now very elaborate JVM Lending Training Program©. I thought it made for perfect blog fodder, as it is information all of us in real estate and mortgages should understand. We are all so focused on mortgage interest rates that we often forget that there […]Read More

“Fed Plans to Keep Rates at Low Levels for Years” What Are “Rates?”

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This blog’s subject line is borrowed directly from this WSJ article. Fed Chairman Powell stated in early June that there are no rate increases in sight and that the Fed will do whatever it has to do to keep rates down through 2022. These actions include keeping the Fed Funds rate near 0% and massive […]Read More

Mortgage Rates Barely Move; Hell Actually Breaks Loose; Fed Cuts Rates to Zero

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FED CUTS FED FUNDS RATE TO ZERO; $700 BILLION IN QUANTITATIVE EASING In a shocking and surprise weekend move, the Fed cut the Fed Funds Rate to 0% yesterday – which may or may not have moved mortgage rates for reasons I explain often (cuts in short-term interbank borrowing rates don’t often translate to cuts […]Read More

Rates Down Despite Fed’s 4th Increase in One Year; Why?

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On December 14th, 2016, I quoted a rate of 4.0%* in this blog. Today I will quote 3.75%. It is interesting that 30 year fixed rates have fallen 1/4 percent over the last year even though the Fed has ostensibly increased rates four times. The Fed increased rates yesterday again and 30-year rates are lower […]Read More