Florida Mortgage Market – Week in Review

by Florida's #1 Mortgage Planner on March 17, 2008

Last week was another wild ride, with volatility playing like never before.  The market “mood swings” were short lived on a daily basis, with bonds doing a seesaw pattern even within the same day several times last week.

The market was ultimately pushed higher by the Fed’s newest bailout program, the Term Securities Lending Facility, which is above and beyond the Term Auction Facility the Fed is already using to pump cash into the system.

Then came news of Carlyle’s struggle to survive, being forced to sell of tons of virtually worthless mortgage paper, suffering huge losses, in order to meet “margin calls”.  Adding to that, the week ended with Bear Stearn’s announcement that it too has suffereed enormous losses and may become completely insolvent.  Of course, the government was there to save the day, as the NY Fed and JPMorgan Chase came to the rescue.  If you read this morning’s update, you will see JP Morgan ended up buying out Bear Stearn’s.

Then came what may have been the biggest surprise of the week, a flat CPI report.  Of course, we all know this is a bogus benefit right now as we can feel inflation hitting us hard right now at the pumps and in the grocery store, so this welcome news will surely be short lived.

Overall, with the whipsawing back and forth, bonds won for the week and mortgage rates improved about .25%.

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