Rates are .2% lower today as investors flock to the safety of mortgage bonds (FNMA 30yr 4% coupon now up 50 basis points) while Middle East protests spread. It began in Tunisia, then Egypt, and now Libya where unemployment is 30% and citizens are again rising up against their leader Muammar Gaddafi. The difference with [...]

Consumer inflation was 0.4% for January and 0.2% if you strip out more volatile food and gas prices. On an annual basis, consumer inflation was also relatively flat at 1.6% total, and 1% excluding food and gas. All of these figures are tame, and this flat consumer inflation news has caused mortgage bonds to rally [...]

Rates are up today as inflation week rolls on. This morning’s reading of January producer prices shows a .8% increase since December and a 3.6% increase since January 2010. Stripping out volatile food and energy prices, the “core” readings showed a greater-than-expected .5% increase since December and a 1.6% increase since last year.

Oil prices are in the mid-$80 per barrel range, and gasoline in many parts of the nation is sitting at or above $3 per gallon for regular unleaded. This is bad news for anyone who uses transportation, or buys goods that are transported. (Did I leave anyone out?) What do higher oil prices mean for [...]

Why Banks Fail Why is a man like a zero coupon bond? They pay little interest, and have no maturity!

Like most economic stats, inflation seems simple: it’s a measure of how consumer or business prices are rising in an economy. But how inflation is measured then interpreted by markets is less simple. Most inflation reports in the press—often referred to as ‘headline inflation’—are total consumer or business inflation numbers. But lots of effort goes [...]

Of course Stephen Colbert can be counted on to crack some quality jokes about Egypt, especially his call to “crush the revolution” if we have to pay higher gas prices (VIDEO BELOW). But TheReformedBroker definitely delivered the Egypt humor quote of the day, also below.

On Friday, a revolution and resulting chaos in Egypt caused U.S. rates (on 30yr fixed loans up to $417k) to drop .125% but Monday rates rose that amount, back to 4.875%, as mortgage bond traders re-focused on U.S. business inflation. The Chicago Purchasing Managers Index is one of many monthly manufacturing surveys done across the [...]

After a better rate day yesterday due mostly to a well-received 30yr bond auction, rates are even today after consumer inflation, retail sales, consumer confidence, and bank earnings figures. Following yesterday’s slightly hotter than expected business inflation report, today’s consumer inflation report confirms a relatively flat inflation environment—which helps keeps rates low. December’s consumer inflation [...]

30-year fixed mortgage rates head into Christmas at about 5% for a single family home loan up to $417,000, and about .25% higher for larger loans and most condo loans. Bond markets close at 2:00 ET today and reopen Monday. While today’s inflation report was flat, mortgage bonds sold off and pushed rates higher on [...]