This is the view from the top.

Just in case you wanted to know what the top looks like! Giving thanks for the many blessings in my life. Thank you :)

Sean La Rue
SeanLaRue.com
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Picture from bike night at Burgers N Beers

Go to http://www.DCSBR.com if you like to ride and sign up for our meet-up

Sean La Rue
SeanLaRue.com
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Untitled

http://ping.fm/zcS5C yeah this song rocks!

via Ping.fm

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http://ping.fm/zcS5C yeah this song rocks!

The Mortgage Hotline Goes on the air at 11am PST.

Today I have the Mortgage Hotline Show on www.KnewsRadio.com and for you Coachella locals it's FM 94.3 and AM 970-1140-1250.  Today we will be talking about the qualification process and get you familiar with how you get approved for a loan.  This is really important for the expectations you have as a consumer for how the process will go.  There's nothing to be afraid of and I work with a lot of first time home buyers.  Other topics will include: managing your credit, when to refinance, and what's changing in condo financing.  Join me today.

Also, you can call into the studio if you have questions at 760-416-8475 or 888-589-6397.  Thanks for listening.

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Kitty needs a home! Does your home need a kitty?

Call me for details and this could be yours! 760-835-5663 -Sean

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Happy Thursday!! Sayin hey

Sean La Rue
SeanLaRue.com
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NAR Convention San Diego

Sean La Rue | NAR Expo 2009 San Diego
Uploaded by SeanLaRue. - More video blogs and vloggers.

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Only on 3: Crime Scene Cleanup

This is awesome!  Someone’s got to do it!  Thanks Millers…

PALM SPRINGS - It's a job most of us don't want to even think about, but the people of Miller's Crime Scene Restoration consider their work a 'calling.'
http://www.kesq.com/global/story.asp?s=11512899

Find more items like this at http://www.kesq.com

Make It A Great Day,

Sean K. La Rue
Sr. Vice President ׀ Franklin Loan Center | Se Habla Español

Direct: 760-837-1488 | Mobile: 760-835-5663 | Fax: 800-784-9089

44-800 Village Court Palm Desert, CA 92260
“Your KEY to Moving Home”

Let's Get Connected!

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Sean's Mortgage WebSite | Sean's Mortgage Blog | Click for Sean's Weekly Update | Click for Sean's Monthly Update | Mortgage Hotline Radio Archives

Join us on the Desert’s New Station FM 94.3 or AM 970, 1140, and 1250 every Sunday from 11am to 12pm for the "Mortgage Hotline" where we are taking your calls to help you wade through the unchartered waters of loan modification and government mortgage programs! You can listen to a live stream at K-News Radio and download archives!

***CONFIDENTIALITY NOTICE: This email may contain information that is privileged or confidential.  If you are not the intended recipient, please delete the e-mail and any attachments without reading, printing, copying or forwarding it, and please notify us.

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Sean La Rue's Weekly Newsletter: Fed Scaling Back Bond Buys (Vol 7, Issue 46)

Clients & Friends,

I’ve learned a lot of cool tips and tools from this week’s NAR conference. I will be doing a video later this week to bring you up to speed.  Stay tuned!

See below for my weekly newsletter recapping all of last week’s financial news, and helpful insight into this week’s economic news.  Feel free to call me at anytime to discuss any of the information outlined in this report.

Have a great week!

This week’s rate sheet is attached.

Make It A Great Day,

Sean K. La Rue
Sr. Vice President ׀ Franklin Loan Center | Se Habla Español

Direct: 760-837-1488 | Mobile: 760-835-5663 | Fax: 800-784-9089

44-800 Village Court Palm Desert, CA 92260
“Your KEY to Moving Home”

Let's Get Connected!

Facebook | Twitter | YouTube | Linkedin

Sean's Mortgage WebSite | Sean's Mortgage Blog | Click for Sean's Weekly Update | Click for Sean's Monthly Update | Mortgage Hotline Radio Archives

Provided to you Exclusively by Sean K. La Rue   For the week of Nov 16, 2009 | Vol. 7, Issue 46

Sean K. La Rue Senior Vice President Franklin Loan Center Office: 760-837-1488 Cell: 760-835-5663 Fax: 800-784-9089 E-Mail: slarue@franklinlc.com Website: www.SeanLaRue.com YOUR Loan Professional … YOUR Key To Moving Home

Last Week in Review

"A STEP IN THE RIGHT DIRECTION...BUT DON'T PUSH YOUR LUCK." Barbra Streisand obviously wasn't singing about Bond prices or interest rates in her 1980's song. But those lyrics were fitting last week when the Federal Reserve stepped in with more buying of Mortgage Backed Securities (MBS), helping Bond prices recover from news of a weak Treasury Auction. Overall, home loan rates bounced around last week and ended the week very slightly improved. But that said, we can't "push our luck" and think the Fed will continue to step in and help support home loan rates...we have to remember that the Fed is actually winding down exactly this type of buying support. As you can see from the chart below, the Federal Reserve's purchases of MBS peaked at an average of $25 Billion per week back in May - and they are getting closer every day to being done spending their allotment of $1.25 Trillion. Since they announced that their remaining purchases would be rationed out until the end of March 2010 - but that they wouldn't be making any additional purchases beyond the original commitment - the average purchases per week have been moving lower, down to $14 Billion per week so far in November. ----------------------- Chart: Fed's Purchase of Mortgage Backed Securities (Weekly Averages Per Month) Why is this important? Because home loan rates are based on MBS - so when the Fed agreed to be a big buyer, it helped provide a market and helped keep MBS prices high and home loan rates low. So as the Fed's program wraps up and eventually stops, home loan rates are quite likely to be on the rise. So while rates are still very good, they may not be for long. Let's be sure to talk if you haven't yet explored how the current rate environment might benefit you or someone you know. More employment news arrived, and it is interesting to hear the media and other experts proclaim it to be "all good news". Initial (or First Time) Jobless Claims came in at the lowest reading in 10 months and Continuing Unemployment Claims also fell lower as well - and at first blush, this seems to be very good news. But looking closer, we see that the lower Continuing Claims number was probably the result of unemployment benefits expiring before people could find work - rather than people dropping off of benefits because they found a job. Now that unemployment benefits have been extended by new legislation, we should get a more accurate look at how many people are actually unemployed. SPEAKING OF EMPLOYMENT... IF YOU OR SOMEONE YOU KNOW IS LOOKING FOR A JOB, TAKE A LOOK AT THE SPECIAL MORTGAGE MARKET GUIDE VIDEO VIEW BELOW ON TIPS FOR A SUCCESSFUL JOB INTERVIEW. IN TODAY'S CHALLENGING JOB MARKET, A LITTLE EXTRA PREPARATION MIGHT JUST BE THE KEY TO LANDING THAT POSITION.

Forecast for the Week

This coming week is loaded with high-impact economic reports. On Monday, we'll get a glimpse of consumer's pre-holiday spending patterns when the Retail Sales report is released. You may have seen that many retailers have started the sales and specials early this year, as well as reintroducing the "layaway" option for purchases - all designed to help keep this holiday season from being dismal for retailers. Inflation news is also on tap this week, as the Producer Price Index is set for release on Tuesday, with the Consumer Price Index following on Wednesday. Also on Wednesday, we'll get a look at the health of the new construction sector of the housing industry with reports on Housing Starts and Building Permits. Thursday, we could see some volatility in the markets when the Treasury Department announces next week's auctions, which will include offerings of 2-year, 5-year, and 7-year Notes. Remember, these auctions will likely continue to cause volatility, as the Federal Reserve has ended their buying program for Treasuries, and as we discussed, has also now started to scale back their purchases of Mortgage Backed Securities (MBS). As the Fed ramps down and ultimately ends their support of the MBS market at the end of March, watch for home loan rates to rise. Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result. As you can see in the chart below, Bond prices hit a two-month low on October 26th - which had caused home loan rates to worsen - but Bond prices have since been pushed higher by continued Fed buying and some weak economic data. Chart: Fannie Mae 4.5% Mortgage Bond (Friday Nov 13, 2009)

The Mortgage Market View...

5 Secrets to a Job Interview Earlier this month, the Labor Department reported that 190,000 jobs were lost in October and that the Unemployment Rate has risen to 10.2%. It's always important to be prepared anytime you go on a job interview, but in today's competitive market it is more important than ever. In this week's special Video View, check out a video from www.Kiplinger.com called "5 Secrets to a Job Interview."

The Week's Economic Indicator Calendar

Remember, as a general rule, weaker than expected economic data is good for rates, while positive data causes rates to rise. Economic Calendar for the Week of November 16 - November 20 Date ET Economic Report For Estimate Actual Prior Impact Mon. November 16 08:30 Retail Sales Oct 0.9%   -1.5% HIGH Mon. November 16 08:30 Retail Sales ex-auto Oct 0.4%   0.5% HIGH Mon. November 16 08:30 Empire State Index Nov 29.00   34.5 Moderate Tue. November 17 08:30 Core Producer Price Index (PPI) Oct 0.1%   -0.1% Moderate Tue. November 17 08:30 Producer Price Index (PPI) Oct 0.5%   -0.6% Moderate Tue. November 17 09:15 Capacity Utilization Oct 70.8%   70.5% Moderate Tue. November 17 09:15 Industrial Production Oct 0.4%   0.7% Moderate Wed. November 18 10:30 Crude Inventories 11/13 NA   NA Moderate Wed. November 18 08:30 Core Consumer Price Index (CPI) Oct 0.1%   0.2% HIGH Wed. November 18 08:30 Consumer Price Index (CPI) Oct 0.2%   0.2% HIGH Wed. November 18 08:30 Building Permits Oct 580K   573K Moderate Wed. November 18 08:30 Housing Starts Oct 600K   590K Moderate Thu. November 19 08:30 Jobless Claims (Initial) 11/14 504K   502K Moderate Thu. November 19 10:00 Index of Leading Econ Ind (LEI) Oct 0.4%   1.0% Low Thu. November 19 10:00 Philadelphia Fed Index spanspanspanspan

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At the wine tasting at the Miramonte in Indian Wells

5 wines and appetizers to be paired! Yum!

Sean La Rue
SeanLaRue.com
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Monthly Economic Update for November, 2009

_______________________________________________________________________________

Quote of the month. “A man is a worker. If he is not that, he is nothing.” – Joseph Conrad

The month in brief. Questions about the strength and speed of the recovery hampered stocks by Halloween, although positive economic news continued to surface. The service sector and the manufacturing sector were both growing; consumer spending, however, was lagging. It was a fine month for most hard assets, and a mixed month for global financial markets. Finally, one notable statistic seemed to indicate the recession was done.

Domestic economic health. Let’s get to that statistic. The Commerce Department announced the 3Q preliminary GDP: +3.5%. U.S. GDP hadn’t been so strong since 3Q 2007. America’s longest stretch of economic contraction since 1947 was history.¹

Backing up that statistic, we had the Institute for Supply Management’s manufacturing index hit 55.7 in October (a 3½-year high point) after a 52.6 in September (anything over 50 equals growth).² We saw the ISM service sector index turn positive for the first time in a year, coming in at 50.9 for September with its new orders index at 54.2.³ The Federal Reserve informed us that industrial production went up by 5.2% in the third quarter – the best quarter in four years, and the first positive quarter since the recession began.⁴

As for consumers, prices and purchases, the data was mixed. Personal spending fell 0.6% in September, even as durable goods orders rose by 1.0%.^5,6 Retail sales were down 1.5% for that month, but up 0.5% minus automotive purchases (economists felt the decline was partly due to the end of the C.A.R.S. program).⁷ Year-over-year inflation was still negative: from September 2008 to September 2009, CPI fell 1.3% (though core CPI rose 1.5%). CPI rose 0.2% for September.⁸

Both notable consumer confidence indices declined in October – the Conference Board index dipped to 47.7 from a 53.4 in September.⁹ The Reuters survey went from 73.5 in September to 70.6 at the end of last month.¹⁰ With unemployment at 9.8% in September, it was understandable.¹¹ Economists discussed the possibility of the Fed raising the key interest rate – in fact, a few even called for it – but there was no hint of a shift in Fed policy.

Global economic health. Evidence showed that manufacturing was picking up abroad as well as in the U.S. The Eurozone’s manufacturing sector expanded in October for the first time since April 2008. China’s Purchasing Manufacturers Index hit 55.4 in October, an 18-month peak. England’s PMI also showed growth, and so did the PMIs in India and South Korea.¹² The International Monetary Fund adjusted its growth forecast for the Asia Pacific region up about 1.5% - it predicted 2009 growth of 2.8% and 2010 growth of 5.8%.¹³

The jobless rate in the Eurozone was 9.7% in September; consumer prices fell for the fifth straight month, nice for shoppers but certainly not indicating demand. New data showed the EU economy shrank 0.2% in the second quarter.¹⁴

World financial markets. Emerging markets fared better than indices in Europe and the U.S. The DAX descended 4.58% in October, and the CAC 40 fell 4.98%. In the U.K., the FTSE 100 lost 1.74% for the month. The Nikkei 225 lost 0.97%, the Australian All Ordinaries 1.95%, and the Kospi (South Korea) lost 5.53%. As for gains, the Hang Seng rose 3.81% and the Shanghai Composite ascended 7.79%. Argentina’s MERVAL rose 2.06% and the Bovespa gained 0.02% in Brazil.¹⁵ MSCI’s World Index and Emerging Markets Index were both down for the month, respectively losing 2.31% and 0.49% for October.¹⁶

Commodities markets. Oil prices rose 9.05% last month, ending October at $77.00 per barrel. Natural gas futures advanced 4.21% in October, leaving that commodity at -10.26% YTD through October’s end. Diesel futures gained 7.41% in October, putting them up 41.00% for the year. Turning to metals, silver actually lost ground last month (-2.42%) but gold did just fine (+3.08%). Copper could not be stopped – copper futures were +4.84% in October and (are you sitting down?) +109.61% across the first ten months of the year. Palladium has done exceptionally well, too: +8.04% for October, making it +71.30% YTD. The U.S. Dollar Index was down 0.34% in October.¹⁵

One crop has done almost as well as copper this year: sugar. Sugar futures fell 5.56% in October, but that left them up 92.89% for 2009. Orange juice futures rose 26.17% last month.¹⁵

Housing & interest rates. The latest existing, new and pending home sales numbers were mostly encouraging. First the downside: according to the Commerce Department, new home sales fell 3.6% in September, a decline many chalked up to the looming potential expiration of the $8,000 first-time buyer credit offered by the federal government.¹⁷ Existing home sales rocketed north 9.4% in September, marking gains in five of the last six months of data.¹⁸ Pending home sales (like existing home sales, monitored by the National Association of Realtors) were up 6.1% in September after a 6.4% rise in August, marking the eighth month in a row of improvement. Construction spending also increased by 0.8% in September.¹⁹

Let’s see what Freddie Mac found when it came to surveying U.S. mortgage rates. On October 1, the national average interest rate for a 30-year FRM was 4.94%. By October 29, it was 5.03%. Average rates on 15-year FRMs also rose slightly in that time frame, from 4.36% to 4.46%. The 5/1-year ARM? No change, a 4.42% average interest rate in both surveys. As for the 1-year ARM, the average rate on that loan type moved north from 4.49% to 4.57%.²⁰

Major indexes. The Dow hit a 2009 high of 10,119.47 in October, but finished the month with only a miniscule gain; the NASDAQ and S&P 500 both slipped. It was a challenging month for stocks, unusual as Octobers go. At month’s end, the major indices were still showing impressive gains off their March lows – the DJIA, +48.4%; the NASDAQ, +61.2%; the S&P 500, +53.2%.¹⁵

% Change	1-Month	Y-T-D
DJIA	+0.005	+10.67
NASDAQ	-3.64	+29.68
S&P 500	-1.98	+14.72
10YrTIPS Real Yield	-0.06	-37.33

(Source: CNBC.com, ustreas.gov, 10/30/09)^15,21

Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly. These returns do not include dividends.

November outlook. It has been a decidedly unconventional year on Wall Street – and thankfully, a very positive one. The S&P 500 actually managed a small gain across the September-October period – a stretch that is often rough on stocks.²²

Historically, November and December have been pretty good months for Wall Street, but we have just seen a half-year rally. Could it extend into winter? Interest rates may remain at record lows into 2010, which would help keep the dollar weak (and that certainly aided the summer market gains). Volatility has reared its head again recently; on November 2, the Dow had closed with either a 100-point rise or fall in six of its last seven trading sessions.²³ Has the rally aged, or does it still have legs? Will November prove an up-and-down month? Wit the fall earnings season wrapping up, we shall hope for positive economic indicators to drive the market higher.

The key economic releases for the balance of November are: the October ISM services index and the Federal Reserve’s Open Market Committee rate decision (11/4), the October jobless report and October wholesale inventories (11/6), preliminary November consumer sentiment (11/13), October retail sales and September business inventories (11/16), October PPI and industrial output (11/17), October CPI, housing starts and building permits (11/18), the Conference Board’s October leading indicators (11/19), October existing home sales (11/23), October durable goods orders and the Conference Board’s November look at consumer confidence (11/24), and October consumer spending, wages and new home sales (11/25).

Riddle of the month. Who is the only woman ever to appear on U.S. paper currency?

 

Contact my office or see next month’s Update for the answer.

Last month’s riddle. In many liquor stores, you can buy pear brandy with an actual pear inside the bottle. The pear is whole and ripe, and the bottle is genuine; it hasn’t been cut open in any way. How does the pear get inside the bottle?

Last month’s riddle answer: It grew inside the bottle. The bottles are placed over pear buds when they are small and then wired in place on the tree. The bottle is left in place for the entire growing season. When the pears are ripe, they are snipped off at the stems.

___________________________________________________________________

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Citations.

1 thestreet.com/story/10618752/1/gdp-stunner-35-growth-in-third-quarter.html?cm_ven=GOOGLEN [10/29/09]

2 reuters.com/article/ousiv/idUSN0243717320091102 [11/2/09]

3 news.yahoo.com/s/ap/20091005/ap_on_bi_ge/us_economy [10/5/09]

4 marketwatch.com/story/oil-futures-tap-fresh-one-year-high-atop-78-2009-10-16 [10/16/09]

5 marketwatch.com/story/consumer-spending-retreats-after-clunkers-ends-2009-10-30 [11/2/09]

6 latimes.com/business/la-fi-briefs29-2009oct29,0,456350.story [10/29/09]

7 money.cnn.com/2009/10/14/news/economy/September_retail_sales/?postversion=2009101409 [10/14/09]

8msnbc.msn.com/id/33344177/ns/business-businessweekcom/ [10/15/09]

9 conference-board.org/economics/consumerConfidence.cfm [10/27/09]

10 abcnews.go.com/Business/wireStory?id=8956838 [10/30/09]

11 cbsnews.com/stories/2009/10/21/business/main5405768.shtml [10/21/09]

12 reuters.com/article/economicNews/idUSN0243555320091102?sp=true [11/2/09]

13 nytimes.com/2009/10/30/business/global/30imf.html [10/30/09]

14 google.com/hostednews/ap/article/ALeqM5ipzZ-ZVFuBCVK810-PpiBUogE45wD9BLGRD03 [10/30/09]

15 cnbc.com/id/33555251/page/2/ [10/30/09]

16 mscibarra.com/products/indices/stdindex/performance.html [10/30/09]

17 bloomberg.com/apps/news?pid=20601068&sid=aPXIvh4rYY60 [10/28/09]

18 realtor.org/press_room/news_releases/2009/10/rebound_shows [10/23/09]

19 bloomberg.com/apps/news?pid=20601087&sid=aVHuhXWfKh5M&pos=3 [11/2/09]

20 freddiemac.com/pmms/ [11/2/09]

21 ustreas.gov/offices/domestic-finance/debt-management/interest-rate/real_yield.shtml [10/30/09]

22 cnbc.com/id/33586664 [11/2/09]

23 foxbusiness.com/story/markets/futures-start-week-positive-note/ [11/2/09]

Make It A Great Day,

Sean K. La Rue
Sr. Vice President ׀ Franklin Loan Center | Se Habla Español

Direct: 760-837-1488 | Mobile: 760-835-5663 | Fax: 800-784-9089

44-800 Village Court Palm Desert, CA 92260
“Your KEY to Moving Home”

Let's Get Connected!

Facebook | Twitter | YouTube | Linkedin

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