This week's indicators
Hi,
Each week I get a couple emails from lenders and title companies about the market- what has happened and what is expected. I am including some exceprts from this week's emails, as I think it is good to point out some of these things.(I am not quoting a source, as this particular email is received from a couple different people.)
"... when Gentle Ben (Bernanke) briefed the Senate on Thursday, the markets slid. Investors didn't like the Fed chief's comment there could be some bank failures amidst all the credit market turmoil. They curiously ignored his more significant observation that capital ratios remain good among the largest banks. Too bad, because all those negative vibes around the financial sector and the economy kept things sliding enough on Friday to result in a losing week (on Wall St).
The Dow ended at 12,266.39, down 0.9%. The S&P 500 fell 1.7% for the week, closing at 1330.63. The NASDAQ had a shallower 1.4% decline to 2271.48.
Economic indicators were up and down too. We got worse than expected reports for new home sales, the producer price index, consumer confidence, durable goods, weekly initial jobless claims, and the Chicago purchasing manager's index. But we also got better than anticipated existing home sales, personal income, and personal spending. The economy has slowed, but is clearly not in recession.
It would be hard to tell that from the media. But the number of economists who think we're heading into a recession is still in the minority. Most experts believe we are experiencing a slowdown but do NOT see the consecutive quarters of negative growth that define a recession. Many look for the benefits of the aggressive Fed rate cuts and the huge fiscal stimulus package to kick in starting early May.
Turbulent stock markets drove quality hungry investors to Treasuries. The benchmark 10-year T-bill gained over a point, its yield dropping to 3.535%, from 3.788% the previous week. This is good news for mortgage rates, which should remain at very favorable levels."