Do people like Jed Clampett control interest rates?

April 14, 2010

Good morning! 

Protest Quote of the Day: “There may be times when we are powerless to prevent injustice, but there must never be a time when we fail to protest.” – Elie WieselTexas Tea: The great Jed Clampett once said, ‘If you’re too busy to go fishin’, you’re too busy.’ I would imagine these days that Clampett is finding himself too busy making money to go fishing. Both Goldman Sachs and Morgan Stanley have predicted oil prices will rise above $100 a barrel next year. Why do oil prices go up? It actually doesn’t have too much to do with supply and demand. 95% of it is caused by people speculating about inflation. Inflation, real or perceived, causes gas prices to rise and causes interest rates to rise. While Jed would like to see $4.00 a gallon this summer, it would take away from him being able to refinance his mansion.Interest Rates: Even though Bernanke ended his mortgage bond spending spree at the end of March, rates have cooperated somewhat. A 30yr fixed is still in the high 4s/ low 5s, and ARMS are about a point lower. Rates will vary based on type of home, equity in the home, credit score, and how I do at the riverboats tonight.Wuss’up This Week: The biggest report of the week comes out today: Consumer Price Index. This is an important report because it measures inflation. How do they measure inflation, Mortgage Fans? The prices of 95,000 items from 67,000 stores are added together and averaged. I can’t imagine how much fun it would be putting this report together. Here is how I do it: The Cap’n Crunch with crunch berries at the Target by my house cost $4.69 last month. Yesterday it was the same. My guess is this report will show inflation is under control (which is good for rates!).Protest Quote of the Day 2: “I’m against picketing, but I don’t know how to show it.” – comedian Mitch Hedberg.Timeout for Trivia: Congratulations to all of you last week who correctly guessed Julian Lennon. Want to be entered into a quarterly drawing to win cool stuff? Simply email me the answer to this week’s Who Am I? question. Good luck: “I turned 39 this week. I’m hard to get along with, I can’t dance worth a lick, and I’ve been in Playboy three times. Not the best resume, but there are some things I can brag about – like the fact that I was named 10th greatest witch in television history (by AOL in 2007), or that I got my start in the early 80s starring in Little House on the Prairie. But screw the little house! I live in a big house in Malibu – and although I won’t give you my address – you’ll know my zip code.”

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