Tag Archive for: inflation

Why Most Agents Need to Refi Before October 15th; Will Rates Ever Fall?

A savvy agent emailed last week asking when she could refinance her condo which is currently at 6.5%. She was anxious to refi BEFORE she files her 2022 tax returns, as her income was down markedly in 2022, compared to 2020 and 2021. Which is the case for most agents! So, this is just another […]Read More

Disinflationary Trend Continues DESPITE OIL & AUTOS! WHOOAA!

REMINDER #1: 14-DAY CLOSINGS WIN DEALS! Two of our clients got into contract yesterday alone with the help of our Fast 14 Calendar-Day Close in multiple offer situations. In both situations, our clients were not the highest offer too. REMINDER #2: JVM HAS “APPROVED AND READY TO MOVE” LISTS ON OUR WEBSITE – for both […]Read More

#1 Reason America Will Always Reign Supreme – And Why We Don’t Need to Worry

Bank Problems Will Get Much Worse! ZIRP Coming Soon! Former hedge fund manager and certified crazy guy, Hugh Hendry, was on Bloomberg yesterday – with this short, informative, and very entertaining video. Here are a few of Hendry’s points: Bank problems will get MUCH WORSE! Deposits will continue to drain out of banks because it […]Read More

7 Reasons Why Analysts Are FURIOUS With The Fed!

Top Ten AI Prompts to Save Hundreds of Hours of Work The above headline was the point of this excellent tweet thread. I highly recommend it for anyone who is still trying to figure out how to use AI. Jumbo Loans Going by the Wayside? Rob Chrisman, the mortgage industry’s premier blogger, wrote this yesterday:  “On […]Read More

Why We NEED A RECESSION & Soon!

Marshmallow.com = My Favorite App! I love marshmallows. And – every three to four months when my craving gets bad, I order marshmallows right to my door from marshmallow.com. And – it is awesome! They show up the same day, and the marshmallows are always fresh and delicious. They come in four flavors (chocolate, vanilla, […]Read More

February Pending Homes Sales: Great News Or Awful News? Inflation Down

The total number of homes that went into contract in February increased by 0.8% in February compared to January. Here are two reactions: Mortgage and Real Estate Industry:  “Holy Smokes – that is amazing, great news, and concrete proof that the housing market remains incredibly strong!” Diana Olick of CNBC:  “We’re all going to die!” […]Read More

The 2nd Biggest Problem in Real Estate (& It Is HUGE)

Expected Lifespan of CALHFA’s Dream Program: < 90 Days This a brief reminder that CalHFA’s Dream For All Program (100% financing/shared equity program) will very likely run out of funds in the near future. Hence, agents and borrowers need to move quickly if they want to take advantage of it. Biggest Problems in Real Estate […]Read More

Fed Raises Rates; Mortgage Rates PLUMMET; Why? JVM’s Here to Stay!

JVM’s Here to Stay; Backup for Banks Pulling Out JVM was officially founded in 2006, and effectively founded in 1999 under another name by my wife, Heejin – with much of her operation carrying over to JVM in 2006. All this is to say that we are definitely here to stay, as we have ridden […]Read More

Please Do NOT File Your Taxes IF…

Please Do Not File 2022 Taxes If… You are self-employed and 2022 was a down year. This is a huge reminder to all self-employed borrowers (real estate agents too) to just file an extension for 2022 taxes – IF their income was way down in 2022 AND they want to qualify for competitive mortgage financing […]Read More

Rates Plummet! Barry Was RIGHT! THIS IS HUGE!

Who the Hell Is Barry? Barry Habib is the founder of MBS Highway, a subscription service that thousands of mortgage industry insiders subscribe to at a cost of $120 to $170 per month – and it is worth it! Barry and his team go way out of their way to provide value on every front […]Read More

Why Is The Fed SO DETERMINED To Push Rates Higher? (Not What You Think)

What Is the United States’ Most Powerful Weapon? 1. It’s Ohio-class nuclear-powered submarines? 2. It’s B83 nuclear bombs? 3. It’s Tomahawk cruise missile? 4. It’s AC-130U gunships? Or 5. It’s Ford-class supercarriers? ANSWER: None of the above. The United States’ most powerful weapon is… the dollar. This is because the bulk of international trade is […]Read More

Inflation Concerns Push Rates Up – Opposite of My Predictions

Mortgage applications fell precipitously recently in direct response to a rise in interest rates. We have seen the opposite effect too over the last several months in response to falling rates. All this is to say (or prove) that mortgage applications and purchase activity are extremely sensitive to interest rates – surprising many people, including […]Read More

Low, High, List Price: How Much Should You Offer on a House?

As the new year opens, you may wonder if you should purchase a home. There is so much causing inflation which is, in turn, taking its toll on the housing market. Not only are sellers losing ground, but currently, even buyers aren’t capturing the market and turning it into a buyer’s market. But waiting to […]Read More

Recession Coming Soon – DESPITE A STRONG JOBS REPORT!

“IF A RECESSION IS COMING, HOW DO YOU EXPLAIN THE STRONG JOBS REPORT?” That was an email I received this morning from the most prominent voice/blogger in the mortgage industry. He is very successful, a great guy, and much more knowledgeable than I am overall, but it is interesting to see how even he follows […]Read More

Rates Fell 1/2% … Almost.

The Most Important News Report Of The Year Dropped Today! The most important news report was today’s inflation data, as depicted in the Consumer Price Index (CPI) report. It is extremely important for those of us in the mortgage and real estate industries because almost nothing drives interest rates more than inflation news. And, as […]Read More

The Cost of Waiting To Buy a Home

Purchasing a home is a significant financial decision that requires careful consideration and planning. For this reason, it is reasonable to expect prospective buyers to get cold feet when faced with a less than ideal homebuying market. But does this mean you should pull out of the housing market to wait for the perfect time […]Read More

Inflation DOWN; Rates UP; What Gives? Housing Inventory Still Tight

15 Degrees Last Night in Austin, TX This has nothing to do with mortgages, but I have to share it because I find it so interesting.  Austin saw a low last night of 15 degrees – which is amazing given that Austin is hundreds of miles SOUTH of cities like Phoenix and Los Angeles that […]Read More

6 Reminders for Depressed Real Estate Agents

A prominent loan officer who has been meeting with multiple real estate agents recently told me that he has never seen so many “depressed real estate agents.” They are depressed he says because their business is way down; their phones aren’t ringing; the clients that they do have are apprehensive about buying; the easy deals […]Read More

Why DEFLATION Is Now Likely and SO SCARY!

HERE’S WHAT’S SCARY: MY NEIGHBOR WAITING TO BUY HIS MERCEDES! You have no idea how scary that is! My neighbor grew up poor in Boston, played college football at the highest levels, and is now a very successful enterprise software salesman. He is also very cheap – so cheap in fact that he went without […]Read More

Inflation Down; Rates Down & More To Come; The Fed Does NOT Control Interest Rates

Inflation (CPI) reports came in lower than expected yesterday – and that pushed rates lower because inflation expectations are probably the biggest single driver of interest rates. According to this tweet by MacroAlf, the lower-than-expected inflation report surprised 65 out of 67 economists surveyed by Bloomberg. It did not, however, surprise Barry Habib or Jeff […]Read More

Commercial Banks Pulling Out Of Jumbo Market; Why & What It Means

Commercial banks are pulling out of the jumbo market rather suddenly – after dominating it for the last year or so. The question is why and what does it mean? When Service Matters We have always been able to crush every commercial bank when it comes to service, as we are far more responsive, we […]Read More

When Great Economic News Is Actually Bad News

I Was Slapped in the Face With Very Good Economic News! For months now, I have been explaining how weak our overall economy is and why that portends much lower interest rates in the near future – no matter what the Fed does. I of course was just repeating what Jim Rickards, Jim Rogers, Stephanie […]Read More

Inflation Slows & Rates Drop AGAIN; WHY SO IMPORTANT?

Rates plummeted yesterday after Fed Chair Jerome Powell made some comments indicating that the Fed will start to slow its rate increases. Rumor has it that he got early notice of today’s delightfully tame inflation reports, and thus decided to back off on his “hawkish” efforts to keep pushing up rates. 10-Year Treasury Yields Fell […]Read More

Much Lower Interest Rates By March; Why & What It Means

On Thursday, CPI (inflation data) came in lower than expected – and we saw one of the largest one-day rate drops ever. I of course blogged about it here: THIS IS HUGE! Inflation & Rates PLUMMET. My biggest takeaway though wasn’t just that inflation and rates dropped; it was to point out how correct the […]Read More

THIS IS HUGE! Inflation & Rates PLUMMET!

Inflation Came In Cool – Exactly As Barry Habib And Jeff Snider Predicted! In 2021, I told a group of mortgage bankers at a lunch how and why rates were going to shoot past 7% in 2022 – and NONE of them believed me. Despite their pushback, I remained very confident in my position because […]Read More

The Effect of the Election on Interest Rates

Rates fell yesterday as soon as investors digested the likely results of the midterm elections. As I often repeat, rates fall when investors expect the economy to weaken or when they expect less inflation or even deflation. Conversely, inflation expectations and/or strong economic signals push rates up. So, yesterday, as it became clear that the […]Read More

The Fed Did NOT “Raise Rates 3/4% Yesterday” – Deflation/Lower Rates Coming Soon Part II

The Fed raised rates 75 basis points or 3/4% yesterday – so my rate quote at the bottom of this blog went from 6.0% yesterday to 6.75% today. FALSE!! THAT DID NOT HAPPEN! My rate quote today is the same rate as yesterday’s even though the Fed “raised rates 3/4%” yesterday. I typed the top […]Read More

Why EVERYONE Needs A House as an Inflation Hedge Now More Than Ever!

I often blog about reasons to buy a property, as there are many: (1) avoid rising rents with a fixed housing payment; (2) tax advantages; (3) ability to do what you want with the home; (4) forced savings/retirement nest egg; (5) pride of ownership; and (6) inflation hedge. BUT – I don’t think I drive […]Read More

Why I Am Convinced Rates Will FALL By March

I have myriad acquaintances in the mortgage industry (mortgage bank CEOs even) who insist rates will continue to rise throughout 2023. They tell me I am crazy to think they will fall as early as March – with inflation surging and the Fed on the warpath. They further tell me that the Fed cannot get […]Read More

Inflation RED HOT! Rates WAY UP! Relief On The Way?

Today’s inflation report (Consumer Price Index/CPI) came in much hotter than expected and rates shot through the roof in response. BUT – as Barry Habib (of MBS Highway fame) has been explaining again and again – this was expected – and should not be alarming. In addition, Mr. Habib carefully explains WHY future inflation reports […]Read More

Why Are Banks Not Paying Higher Rates for Deposits? Why Did Rates Plummet Today Too?

Why Interest Rates Are Rising Everywhere – Except Your Savings Account That was the headline from this recent WSJ article. Back in the 1980s, a general lack of savings in America was one of the many reasons why America was going to collapse, and we were all going to die… This was ostensibly because Japan […]Read More

Everything Lags…Making The Media & The Fed Wrong (AGAIN)

In 1992, the rock band R.E.M. released the annoying song, Everybody Hurts. And, sensitive Gen Xers everywhere played it loudly and proudly on their Sony Walkmans and boomboxes to prove just how sensitive they really were (and they were sensitive!). But, fortunately for us, Michael Stipe retired from R.E.M. so he could watch macro videos […]Read More

DEFLATION Coming Soon To A Theater Near You!

Stephanie Pomboy is the founder of a macro research firm called MacroMavens, and she was on this Wealthion Podcast recently, and it was so interesting I had to blog about it! I was fascinated by her insistence that we face DEFLATION as early as next year because everyone is talking about how entrenched INFLATION is […]Read More

The Fed Raised Rates And Something VERY UNUSUAL HAPPENED!

The Fed raised the Fed Funds Rate yesterday by 0.75% and long-term rates actually increased (a lot) after the announcement. This is very unusual for several reasons: The markets had long anticipated the 0.75% hike and had “priced it in” already. The Fed only controls short-term rates and not long-term (30-year fixed) rates, so long-term […]Read More

Inflation Drives Interest Rates – Except When The Fed Gets Involved

As most people know, inflation drives interest rates because investors do not want to accept yields that are lower than the inflation rate because they will effectively be losing money if they do. If you loan somebody $1,000 for one year at 5%, and inflation is at 8%, at the end of the year, you […]Read More

The Fed’s Raising Rates 3/4%! OMG! CoreLogic Predicting 4% Home Appreciation Still!

The Fed let it be known yesterday that it will definitely raise the Fed Funds Rate by 0.75% on September 21st… and the market yawned. As Barry Habib reminded us this morning, everyone used to engage in a huge guessing game – in regard to what the Fed might do. And – if the Fed […]Read More

Why’s Inflation Higher in U.S.? Scary LinkedIn Indicator! I Missed Something HUGE!

Today’s blog is a “random show” – hitting a few (really interesting) topics briefly. Something Huge I Missed: Rising Incomes! In my blog yesterday about putting rising housing payments in perspective, I missed one of the most important points: RISING INCOMES! Incomes have risen sharply since 2015, particularly in the tech world, greatly offsetting the […]Read More

This Ain’t 2008 – Again

I Could Rotate My Foot 270 Degrees – So Naturally, I Panicked About 15 years ago, I turned my entire knee into butter while I was skiing at Squaw Valley (now Palisades Tahoe). I was skiing with a bunch of way-too-cautious boomers that day, so I escaped during lunch to do one fast run. Wanting […]Read More

Fed: “We’re Going to Beat The Shit Out Of You Until Inflation Goes Away”

Fed Chair Powell spoke today in Jackson Hole, Wyoming, in a much-anticipated speech – and it roiled the markets. Here is a brief summary in case readers are interested. CONTINUED RATE INCREASES/0.75% HIKE LIKELY. Powell implied that the Fed is going to continue raising rates aggressively, despite “some pain to households and businesses” (hence my […]Read More

Inflation Cools & Rates Plummet; More Inventory ≠ A Housing CRASH

CPI Inflation numbers came out surprisingly cool this morning – indicating it was flat month-over-month and down year-over-year (it was 9.1% in June but 8.5% in July). 8.5% inflation is still sky-high and probably under-reported too, but the bond market loved it and rates plummeted (because the reports were much lower than expected). Rates plummeted […]Read More

Why Major Inflation Is Inevitable – At Some Point (What To Do About It)

The world is facing massive energy and commodity shortages due to a lack of investment over the last several decades, and it will take decades more to replenish supplies and/or to find alternatives.Read More

Rates Went Way Down Because Rates Went Way Up (AGAIN)

The Fed raised the Fed Funds rate by 0.75% yesterday as expected, and long-term rates have been falling ever since. I would not beat this dead horse again but for the fact that rates are continuing their slide downward as I type, and because of how important this all is for housing and mortgages. As […]Read More

China’s Banking System Collapse Is Terrifying; Why It Matters

EVERYONE IS FOCUSED ON “FED DAY” – which is the day of the month (today) on which the Fed announces its latest increase in the Fed Funds Rate (expected to be 0.75%, and the market has “priced it in” already). BUT – there is an economic issue brewing overseas that is 100x more momentous and […]Read More

If High Rates Bring Down Housing Prices, Will Low Rates Push Prices Through the Roof Again? Inflation Too!

If higher rates are the sole reason the housing market is softer, will the soon-to-be-here lower rates push prices through the roof again? If that is the case, it is one more reason to buy now to take advantage of today’s slower market, knowing that a refi into a much lower rate is very likely.Read More

Why A Strong U.S. Dollar Is TERRIFYING! (and what it means for real estate)

The mighty U.S. dollar has been hitting 20-year-highs over and over recently – and I was so proud that I booked a flight to Europe and ran around yelling: “USA! USA! USA!” and “We’re Number 1!” We’re Number 1!” until… … someone slapped me and explained that the strong dollar has little to do with […]Read More

Is Inflation “Over?” (and boy does it matter!)

Inflation Is Here To Stay! (or not) After telling us that inflation was transitory or temporary for months in 2021, many if not most economists changed their tune and declared that inflation was here to stay. This is why the Fed changed course so quickly and aggressively this year, and it is largely why interest […]Read More

Supply Chains Untangling; Inflation Waning? Who Was Right?

For much of 2021 we were shown photos of container ship parking lots drifting far out to sea – with dire warnings of inventory crises and mass shortages. But today, Leonard Steinberg shared this in his Compass blog:Read More

What If Rates Don’t Fall? WRAP-AROUND MORTGAGES

“… I remember my first mortgage back in 1982, when my rate was 15%!” said every boomer ever… “… I remember my first mortgage back in 1982, when my rate was 10%!” said my law school professor… The above two comments are huge reminders that homes still sell in even the highest of interest rate […]Read More

Barry Speaks! Fed Disdain; Recession & Low Rates Coming; Housing Will Be Fine

Barry Habib reminds us that it is inflation that is driving higher rates, but that it will peak in October and start to fall for two reasons: (1) today’s higher rates are destroying demand across the board (I again suggest watching the video for his full explanation); and (2) supply chains will be untangled and working by then, eliminating shortages.Read More

A Home Is Your Castle Against Rising Inflation

My title is the exact headline from this recent WSJ column by economist Laurence Kotlikoff. The first line of his column was this: “Mortgage rates are up to 5%, and some fear a valuation bubble. Even so, it’s a good time to buy.” I have been beating the “houses-equal-inflation-hedge” dead horse for years now, but […]Read More