Economic News

News from HSH Associates:

As sometimes happens, while some interest rates rose this week, other interest rates eased back. Although seemingly contradictory, it works in the context of the market this week: while the Federal Reserve was busy lifting the Federal Funds target by another quarter-percentage point, mortgage interest rates eased back a bit, with the average 30-year FRM closing the week at 6.41%, according to the national mortgage pricing survey conducted by HSH Associates, Financial Publishers. The weekly survey also revealed a slight drop in the average rate for a five-one Hybrid ARM, which closed the week at 5.94%.  Currently, it is expected that one or perhaps two more increases from the Fed are due, starting with the January 31 1 meeting, which will be Mr. Greenspan’s last as Chairman.

Retail Sales for November rose a solid but unspectacular 0.3%, a little below forecasts.

Consumer Price Indices represent at least some measure of the Fed’s level of success in combating inflation. For November, the headline CPI slid by 0.6%, helped along by falling gasoline prices, while the “core” CPI managed a 0.2% lift. For the year, CPI has risen by 3.5%, while the core has crept just 2.1% higher.

Mortgage rates are expected to drift a few basis points next week, probably lower.

 

Is the glass half-full or half-empty?

The confusion that exists as to the direction that the real estate markets are headed can be summed up by the following two headlines which appeared in the December 7, 2005 issues of the South Bay Daily Breeze and the Los Angeles Times in reporting on the same annual business forecast of the UCLA Anderson School of Business:

“UCLA Report Sees Housing Dip” - South Bay Daily Breeze

“Hot Housing Market Still Cruising” -  Los Angeles Times 

Interesting numbers from Al Hermann of American California Financial

NOT DONE YET? - The Fed raised short-term interest rates last Tuesday ( 12/13/05 ) to 4.25%, its 13th consecutive rate hike.The Fed’s very brief statement released after the meeting indicated that “some further measured policy firming is likely to beneeded.” The Fed’s # 1 meeting of 2006 and Alan Greenspan’s final meeting as Chairman will be on 1/31/06 (source: FederalReserve).

The last official recession in the USA ended in 11/2001. Our economy has been in expansion since then,thus making next month (January 2006) our 50th consecutive month of growth. Prior to the 2001 recession, the economy hadexpanded for 120 consecutive months, the longest stretch of expansion in our history dating back to the 1850s. Our nation’saverage expansion period has lasted 33 months (source: NBER).

Hello world!

This is my brand new web blog, provided by Maureen Megowan, realtor with Remax Palos Verdes Realty, designed to keep you up to date on real estate news for Palos Verdes and the South Bay of Los Angeles. I will try and keep you up to date on breaking news that can affect the real estate markets in the South Bay of Los Angeles. In addition, visit my website at http://www.maureenmegowan.com for the most complete residential real estate resource on the web. It has all the information you need to buy or sell your home including MLS listings, income and property tax information, financing info, marketing info, market updates, history of the South Bay and all of the beach cities, information on each of the cities in the South Bay including school info, parks and recreation, neighborhood descriptions, culture, seniors info, and much, much more!