Weekly Market Update from Curt and Shannon



September 26, 2011


The Dalpiaz Team
Curt and Shannon
141 S. McCormick Street
Suite #107
Prescott, AZ 86303

Fall has just begun, but we're fast approaching the end of 2011. Please don't miss the opportunity to improve financial conditions for everyone in your network. There's never been a better time to save money and consolidate debt.

Whenever you need assistance, I'm here for you. Homebuyers have more reasons than ever to buy a home – interest rates are exceptionally low. It would be a pleasure to help.


Curt and Shannon




New Fed Programs Help Mortgage Rates



Average 30 yr fixed rate

Stocks (Weekly)


August Existing Home Sales rose 8% from July

The IMF downgraded its forecast for global economic growth

S&P cut Italy's debt rating again

Oil prices fell to $80 per barrel from $90 per barrel last week


This week: -0.20%


Dow: 10,750 -700




Last week: +0.10%


NASDAQ: 2,475 -125



Last week, the Fed announced new measures to boost the economy. Expectations are low for much economic growth to result from the measures, but they did help push mortgage rates to historic lows.

The Fed released its statement Wednesday afternoon, and MBS markets then staged a very strong rally for several reasons. First, quite simply, the Fed confirmed that there are 'significant downside risks' to the US economic outlook. Slower economic growth reduces inflationary pressures, which is favorable for mortgage rates. Second, the Fed announced the widely expected Operation Twist program. This program will extend the average maturity of the Fed's portfolio by purchasing $400 billion of longer-term Treasury securities and selling an equal amount of shorter-term Treasuries. The third major element from the statement helping mortgage rates was a surprise to most investors. The Fed will begin to reinvest principal payments from its mortgage-backed securities (MBS) holdings in additional agency MBS. Until now, the Fed has been reinvesting the MBS principal payments in Treasury securities.

With roughly $885 billion in MBS holdings in the Fed's portfolio, these principal payments, along with Operation Twist, will create a significant source of additional demand for MBS. The impact of the announcement was priced in very quickly. Although the Fed has not yet begun to purchase securities under the new programs, investors have already factored in the expected impact of the added demand on MBS prices. Following prior Fed announcements about purchasing MBS, nearly all of the benefit took place right away.

This week, New Home Sales will be released on Monday. Durable Orders will come out on Wednesday. The final revisions to second quarter GDP will be released on Thursday. Pending Home Sales, a leading indicator, will also come out on Thursday. Friday will be a big day with Core PCE inflation, Personal Income, Chicago PMI Manufacturing, and Consumer Sentiment. In addition, there will be Treasury auctions on Tuesday, Wednesday, and Thursday.




The market commentary material provided is from a third party vendor, MBSQuoteline, and is not necessarily the opinions of the sender or the organization they represent. This information is intended for educational purposes only and should not be construed as investment and/or mortgage advice. Additionally, the material is deemed to be accurate and reliable, but there is no guarantee it is without error.


All products are subject to credit and property approval. Program terms and conditions subject to change without notice. Not all products are available in all states or amounts. Other restrictions and limitations apply.

Academy Mortgage Corporation
1218 East 7800 South #100
Sandy, UT 84094
p. 801-233-3700

Equal Housing Lender

Company NMLS ID # 3113 LO License #912852 Company License # 0904081 LO NMLS #243638

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This is not the opinion of Brad Bergamini, Realty Executives Northern Arizona or any of its affiliates.  This post is for informational purpose only and is not guaranteed and does not render as legal advice.  Buying and selling Real Estate in Arizona or Prescott Arizona is a serious task and should be consulted with personally with Realtor or Real Estate Attorney.  Please visit my website for contact information

http://bradbergamini.com or http://everythingprescott.com