Reminiscing about high rates and high school…
Wuss’up This Week: Have you been saving your money for this week’s exciting 30-year Treasury bond auction?! Me neither, but hopefully some people have. Thursday’s $16 billion bond auction can lead to lower rates if there is a strong demand for them.
Speaking of Bonds: In April the Fed stopped his 18 month spending spree on bonds (which helped keep rates low), but what are these rumors he may start to buy them again? The Wall Street Journal reported that the Fed might make “a modest but symbolically important change,” in how they manage their securities portfolios. I never understood symbolism and that’s half the reason I failed my Catcher in the Rye test in high school, but I do know that the Fed has maturing bonds that they may take the proceeds from to restart another bond spending spree…and that, Mortgage Fans, would lead to even lower rates.
Interest Rate Update: When I first got into this crazy business in 1998 the 30yr fixed rate was at 8.0%. When it dropped to 7% the refinances began. Imagine being excited for a 7% interest rate! We’ve come so far, haven’t we? Don’t chase that last .125% if you are thinking of refinancing because one of these days it will go up and never come back down. 30yr fixed rates are hanging around the mid-4s and ARMS about a point lower. Remember to tell everyone you know that any loan over 240k I will waive all fees on!!
Time Quote of the Day 2: “Donger’s been here for five hours and he’s got somebody. I live here my whole life, and I’m like a disease.” -Samantha (Molly Ringwald), Sixteen Candles (1984).
Non-Mortgage Related Thought That Just Hit Me: Just about any song ever recorded can be improved if bongos are added.
Timeout for Trivia: Congratulations to all of you last week who correctly guessed Prince. Want to be entered into a drawing to win really neat stuff? Simply email me the answer to this week’s Who Am I? question. Good luck: “It was on this date in ’92 that my husband and I became parents with a daughter. Nothing ironic to say about that, but here’s some fun irony that has surrounded my life: I had a bit part in the movie Sid and Nancy (about the punk rockers that were rock stars). In real life both me and my husband are famous rock stars. My biggest album which had the word ‘Live’ in the title was released days after my husband died. In ’96 I starred in a movie about nudity and porn, and in ’04 I flashed Letterman my breasts in an interview that didn’t go over too well. I didn’t care. When you are an alcoholic and acid user you fall into this hole that is hard to get out of.”