Tag Archive for: the fed

Why The U.S. Can Print Money With No Inflation – But Other Countries Can’t

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There is probably no more important concept for people to understand than this: why can the U.S. print so much money without inflation when other countries can’t? It is so important because so many people are under the impression that our massive government deficits are going to crash the dollar from all the “printing” and bring on “hyperinflation.”Read More

What’s Balance Sheet Runoff? (You Need to Know); Highest Rates in 2024; Rental Income From Departing Residence; Can Agents Do Loans?

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Today’s blog is a “random show” of short and unrelated (but interesting, I promise) snippets. Interest Rates Hit Peak for 2024 Rates are their highest level of the year and […]Read More

Inflation Comes In Hot! Rates Shoot Up; BUT – Will It Last? Maybe Not

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Today’s Consumer Price Index (CPI) inflation report came in hotter than expected, and the markets went into panic mode. Rates shot way up, as rate cuts by the Fed seem less and less likely. (Rates are 3/8% higher than where they were a few weeks ago, but still over 1/2% LOWER than where they were in October).Read More

Can Communists and Federal Reserves Control Economies Forever? No. So, Buckle Up!

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Which country has far more debt than the United States? The answer is China, along with many other countries. Everyone focuses on the United States’ massive federal debt levels, but […]Read More

Why I Still Love Stocks – Despite the Looming Crash

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I have blogged about a potential stock market crash or at least a substantial correction many times. I still think the stock market will correct, and it will likely do so this year** – but I don’t think anyone should sell all of their stocks. I always just repeat George Gammon’s advice and advocate diversification across asset classes and remaining liquid enough to pick up bargains – should the stock market correct significantly.Read More

Fed Promises 3 Rate Cuts This Year – But WHY? (Very Confusing Message)

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The Fed held the Fed Funds Rate steady this month – which was no surprise. The big surprise was that it announced that we’d see 3 rate cuts this year […]Read More

Why Fed Chair Powell Is TERRIFIED of Arthur Burns! (Why Powell Will Not Cut Rates Now; Why He Will Cut in June)

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Jerome Powell is terrified of having an Arthur Burns legacy. So, he’d much rather push the U.S. into a severe recession than risk cutting too soon – and re-igniting inflation. Yes, recessions and all the job losses and suffering are bad, but as Mr. Volcker’s legacy has shown us – Americans forgive Fed Chairs who cause horrible recessions, but we don’t forgive Fed Chairs who ignite inflation.Read More

LOs Can Quote ANYTHING When You’re Not In Contract; Owner-Occupancy Fraud Alert! Hot Inflation = Higher Rates

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We lost a borrower during the pre-approval stage to another loan officer (LO) who quoted an “estimated” interest rate that was 1/4% lower than ours. We tried to explain to the borrower that LOs often quote below market rates to lure borrowers in before they’re in contract – but our borrower fell for the ruse. LOs get away with this because they know they don’t have to lock in the rate before borrowers are in contract. The LOs hope that rates will fall, that borrowers will have short memories, that they can tell borrowers rates went way up since the last quote, or that borrowers just won’t want to go to the trouble of going to a new lenderRead More

Will Biden’s Housing Assistance Plan Help Housing?

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My son and I recently visited a fast-food restaurant in CA’s Central Valley where the new minimum wage laws ($20 per hour starting in April) had been implemented – and […]Read More

Beware of False Employment Reports! Their Impact Is Only Temporary

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Hot jobs reports can push rates way up, but they should not be trusted. The actual data surfaces sooner or later, and rates adjust back downward. Sometimes it takes a day or two, and sometimes, unfortunately, it can take a few weeks or even months. Soft jobs reports from the BLS should also not be trusted, even though the mortgage industry desperately wants to believe them because we desperately need lower rates…Read More

Lower Rates = More Competition For Buyers – Which Is Something Buyers Don’t Understand; Fannie Mae’s Confusing Buyers Survey

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83% of consumers do NOT think now is a good to buy a house! But, at the same time, Fannie Mae’s Home Purchase Sentiment Index just hit its highest level since March of 2022! Fannie’s Home Purchase Index simply reflects consumers’ current and forward-looking views of overall housing market conditions.Read More

Interest Rates Up Again; Trends Vs. Blips; How Worried Should We Be?

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The “average interest rate” peaked at just over 8% in October. Interest rates then slid downward 1.5% over the next few months before heading back north over the last few weeks. While they remain 1% lower than where they were in October, the slide upward over the last few weeks has left many people in the real estate and mortgage world all too worried. Read More

5 Fail-Safe Recession Indicators

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Three pieces of news surfaced yesterday that should have pushed interest rates through the roof! 1) Inflation (CPI) came in much hotter than expected; 2)The Fed made comments about “rates needing to stay higher to ensure inflation is tamed;” and 3)An employment report (jobless claims) came in much stronger than expected. When I saw this news surface, I thought we’d see rates climb at least 1/4% yesterday, but instead they actually fell a bit.Read More

Michael Jordan’s Brand Earns Him $330 Million Per Year, Dwarfing His NBA Earnings; Rates Back to April Levels

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Michael Jordan earned $94 million just for playing basketball over the course of his entire career. Last year alone though, he made a full $330 million just from the royalties from his Jordan shoe brand (via Nike). Hence, he makes 3.5x more every year from shoe royalties than he made playing in the NBA for 15 seasons.Read More