Mortgage Rates News

More Negative Press for Fannie and Freddie

Last week former Federal Reserve Chairman Alan Greenspan strongl y criticized the form of the Congressionally mandated Freddie Mac/Fannie Mae "backstop" program and a survey by the Wall Street Journal found that a small majority of economists involved thought the bailout of the two government sponsored entities (GSEs) would ultimately be invoked, handing taxpayers responsibility for their $5.2 trillion debt.

Meanwhile, more voices were added to the chorus of experts and pundits predicting that government intervention will be required.

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Fed's Lacker Says Rate Hike Should Come Sooner Rather than Later

Speaking in an interview with Bloomberg TV, Richmond Federal Reserve President Jeffrey Lacker (non-voter) said the Fed should not wait too long for a rate hike.

The Richmond Fed President said inflation will slow if oil prices drop. He added that inflation is still a "risky situation," and that keeping inflation in check requires a tight monetary policy...

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Fed's Fisher Says FOMC Cannot Risk Credibility, Must Act if Inflation Continues

The Federal Reserve must be prepared to take action and curb inflation if slowing growth doesn't moderate prices as expected, said the most hawkish member of the FOMC on Tuesday.

Dallas Fed President Richard Fisher (voter), who has dissented from keeping interest rates on hold at the last two FOMC meetings, said the Fed will put its credibility at risk if it fails to combat inflation. He said the Fed has...

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Soft Freddie Mac 5-Year Auction Shows Credit Worries

U.S. government-backed mortgage finance company Freddie Mac caused ripples through the debt market on Tuesday after weak results in a $3 billion, 5-year note auction.

The reference note sold for 113.0 basis points above the 5-year Treasury benchmark. Before the auction, the 5-year spread was 105 bps.

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Weakening Economy Favours Obama Win, Economists Say

The weakening economy is a major negative factor for the Republicans and presents candidate John McCain with an uphill battle for the Oval Office, economists from Global Insight say.

Historically, there has only been one other election year where year- over-year growth in disposable income per capita was negative, noted Nigel Gault, chief U.S. economist at Global Insight...

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Drop in U.S. Housing Starts Due to Inflated June Figure, but Trend Still Downward

Despite coming in slightly higher than was expected, housing starts still slid 11% to 965k in July, though economists say the drop is misleading given the artificially high reading in June.

Last month, economists unanimously agreed that the headline index was misleading due to a change in the housing code of New York City which propelled the jump.

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Tuesday's Events: PPI, Housing Starts and Building Permits

The release of U.S. producer price index along with housing starts and building permits for July tops news today. Markets will also be paying attention to comments from Dallas Fed President Richard Fisher and U.S. Treasury Secretary Henry Paulson speaking at separate events.

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July All-Items PPI Soars 1.2%, Core up 0.7% M/M

The U.S. Department of Labor's seasonally adjusted core measure of producer price inflation grew well beyond expectations with a 0.7% month-over-month gain in July, much faster than the 0.2% gain seen in the previous two months. The all-items measure of producer price inflation soared 1.2% in the month, following an even faster 1.8% pace in the prior month.

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U.S. Housing Starts Fall 11% in July

U.S. housing starts fell in July, but came in above expectations at 965k, representing a month-over-month decrease of 11.0%, according to data released from the U.S. Department of Commerce on Tuesday morning. The drop in the headline is misleading, however, as changes in the housing code of New York City raised June's housing starts and permits figures to elevated levels.

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Foreclosures Loom as Possible Public Health Menace

It seems hard to believe, but there appears to be yet one more thing for which we can blame the mortgage crisis. And this is not a financial problem; it is a public health concern.

Several cable networks have reported over the last few weeks that the hundreds of foreclosed houses covering suburban neighborhoods may be contributing to the spread of the West Nile virus.

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