Even before it began, this week was destined to be interesting, if not downright important, due to the data and events on the calendar. The scheduled events were joined by unexpected headlines, making for even more market volatility. By Friday, just when the stars seemed to align for rates to break below 2017’s constrictive range, they shot paradoxically higher! Why would they do such a thing?
Source: Kevin Litwicki Universal Lending
Making Sense of This Week's Crazy Market Movement

Read more

Last week’s newsletter made the case that this week’s Fed rate hike was “pointless” because bond markets (and mortgage rates) had already fully adjusted for it. Instead, it would be the Fed’s economic projections (their forecasts for future rate hikes) that would make or break this week’s rate movement. That’s exactly what happened.
Source: Kevin Litwicki Universal Lending
Fed Hikes, But Mortgage Rates Fall. Here's Why

Read more

It used to be that higher inflation meant higher rates, period. That changed abruptly beginning in 2011. The combination of global financial panic and unconventional monetary policy helped rates plummet even as inflation recovered from its post-meltdown lows. The longstanding correlation seemed to have broken, but it’s beginning to look like it has merely been dormant.
Source: Kevin Litwicki Universal Lending
Inflation is Just One of Rates' Multiple Personalities

Read more

The US presidential election and the ensuing shift in tone on the part of the Federal Reserve were certainly game-changers for financial markets in the short term. But now that the dust is settling from the initial reaction, markets are looking like they’re not entirely sure where they want to go from here. Are they confused, scared, or just waiting?
Source: Kevin Litwicki Universal Lending
Are Markets Confused, Scared, or Just Waiting?

Read more