INFO THAT HITS US WHERE WE LIVE You can't sugar-coat last week's housing reports, but they don't necessarily foretell a "double-dip" recession in real estate. July Existing Homes Sales were off 27.2%, at an annual rate of 3.83 million, well below the expected 4.65 million rate. The months' supply went from 8.9 to 12.5 and there was also a rise in inventories. The truth is, the expectation was a bit high. An annual rate below 4 million for July makes sense, given that the home buyer tax credit was slated to end in June.Getting an $8,000 check from the government certainly encouraged lots of people to move up their purchases. For the same reason, experts also predict weak August numbers, but after that, some feel existing home sales will start heading back to about 5.5 million units annually. For the year, inventories are down 2.0%, while the median price is UP 0.7%.
July New Home Sales were down 12.4% to a 276,000 annual rate, below the expected 330,000 pace. The months' supply went to 9.1, but inventories were unchanged at 210,000, their lowest level in decades. Part of the sales drop was because the now expired tax credit required a signed contract by April 30. New homes sales are counted at contract and the April number hit 414,000. In the three months since then, sales are averaging only 291,000 annually. New home buyers may also be going for recently built homes, now at attractive prices. New homes, typically about 15% of sales, are now around 7%!
The Mortgage Bankers Association's weekly survey showed purchase loan applications UP 1% from the week before, refinance applications UP 6%, and mortgage rates at record low levels.
>>>> Review of Last Week
THANK YOU, BEN... Ben, of course, is Chairman Bernanke, head of the Federal Reserve. Friday he said the Fed has no triggers set for further easing of monetary policy and he sees continued economic growth. These comments at a central bank summit in Jackson Hole, Wyoming, were all the Wall Street bulls needed to hear to push stocks up Friday after a week of declines. The big rally wasn't quite big enough, though, as the three major indexes still ended down for the week just a tad.
There were other decent economic signs. The August Richmond Fed index of manufacturing in the mid-Atlantic region was +11, down from July's +16, but higher than expected and showing that the factory sector still continues its strong growth. Durable Goods orders were UP 0.3% for July, but disappointed because 3.0% was forecast. Nonetheless, Durable Goods are UP 9.3% over a year ago. Initial unemployment claims dropped by 31,000 to 473,000 for the week, a nice sign after last week's surge. Continuing claims also fell, by 62,000 to 4.46 million.
Friday featured two big news items. First, Q2 GDP was revised lower, from 2.4% to 1.6% growth, but this was measurably better than what many economists had expected and significant parts of the report showed improvement. Personal spending and business Investment were both revised UP, with domestic purchases UP 4.3%. Corporate profits continued their strong growth in Q2, UP at a 20% annual rate and UP 39% over a year ago. Then we had Chairman Bernanke reassuring investors he expects growth to pick up in 2011 and the Fed is ready to use "unconventional measures if it proves necessary." Again, thank you, Ben!
For the week, the Dow ended down 0.6%, to 10150.65; the S&P 500 was down 0.7%, to 1064.59; and the Nasdaq was down 1.2%, to 2153.63.
Bonds had a bit of a rocky week, ending with investors heading back into stocks on Friday, willing to take on more risk after listening to Bernanke. The FNMA 30-year 4.0% bond we watch still ended UP 5 basis points for the week, closing at $102.20. Freddie Mac's survey showed national average fixed rates for conforming mortgages at historically low levels for yet another week.
>>>> This Week’s Forecast
INCOME, JOBS, INFLATION, JOBS, MANUFACTURING, JOBS, HOME SALES, JOBS...There will be important economic reports to ponder, but rest assured, everyone will have Friday's August Jobs Report on their minds the whole week. Experts project a smaller loss of payrolls than the prior month, with the jobless rate about the same. Leading up to the biggie, Monday features July Personal Income, forecast up, and July PCE readings, which should show inflation remaining pretty much in check. Tuesday's Consumer Confidence is projected up a little, but manufacturing is predicted down a tad, as measured by Tuesday's Chicago PMI and Wednesday's ISM Index. Tuesday afternoon we'll have the minutes from the Fed's August 10 meeting and see if they add any insight to Bernanke's comments last Friday.
>>>> The Week’s Economic Indicator Calendar
Weaker than expected economic data tends to send bond prices up and interest rates down, while positive data points to lower bond prices and rising loan rates.
Economic Calendar for the Week of August 30 – September 3
>>>> Federal Reserve Watch
Forecasting Federal Reserve policy changes in coming months With concerns about the economic recovery continuing, virtually all the experts believe the Fed will keep rates low for an "extended period," well into next year. Note: In the lower chart, a 1% probability of change is a 99% certainty the rate will stay the same.
Current Fed Funds Rate: 0%–0.25%:
Probability of change from current policy:
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© 2010 PrimeLending, A PlainsCapital Company. Trade/service marks are the property of PlainsCapital Corporation, PlainsCapital Bank, or their respective affiliates and/or subsidiaries. Some products may not be available in all states. This is not a commitment to lend. Restrictions apply. All rights reserved. PrimeLending, A PlainsCapital Company (NMLS no: 13649) is a wholly-owned subsidiary of a state-chartered bank and is an exempt lender in the following states: AK, AR, CO, DE, FL, GA, HI, ID, IA, KS, KY, LA, MN, MS, MO, MT, NE, NV, NY, NC, OH, OK, OR, PA, SC, SD, TN, TX, UT, VA, WV, WI, WY. Licensed by: AL State Banking Dept.- consumer credit lic no. MC21004; AZ Dept. of Financial Institutions- mortgage banker lic no. BK 0907334; CA Dept. of Corporations- lender lic no. 4130996; CT Dept. of Banking- lender lic no. ML-13649; D.C. Dept. of Insurance, Securities and Banking- dual authority lic no. MLO13649; IL Dept. of Financial and Professional Regulation- lender lic no. MB.6760635; IN Dept. of Financial Institutions- sub lien lender lic no. 11169; ME Dept. of Professional & Financial Regulation- supervised lender lic no. SLM8285; MD Dept. of Labor, Licensing & Regulation- lender lic no. 11058; Massachusetts Division of Banking– lender & broker license nos. MC5404, MC5406, MC5414, MC5450, MC5405; MI Dept. of Labor & Economic Growth- broker/lender lic nos. FR 0010163 and SR 0012527; NH Banking Department- lender lic no. 14553-MB; NJ Dept. of Banking and Insurance-lender lic no. 0803658; NM Regulation and Licensing Dept. Financial Institutions Division- lender license no. 01890; ND Dept. of Financial Institutions- money broker lic no. MB101786; RI Division of Banking- lender lic no. 20102678LL and broker lic no. 20102677LB; TX OCCC Reg. Loan License- lic no. 7293; VT Dept. of Banking, Insurance, Securities and Health Care Administration- lender lic no. 6127 and broker lic no. 0964MB; WA Dept. of Financial Institutions-consumer lender lic no. 520-CL-49075. PrimeLending, A PlainsCapital Company is an Equal Housing Opportunity Lender
INFO THAT HITS US WHERE WE LIVE Housing starts were UP 1.7% for July to a 546,000 annual pace, but this was below expectations and all the gain came from a big boost in multi-family starts. Single-family starts were off 4.2%, declining for the third straight month. Looking at the market further out, we saw new building permits down 3.1% for July to a 565,000 annual rate.
There is no denying that these reports reflect a softness in the home building market. But some experts see the data as part of a temporary housing market hangover following the expiration of the tax credits. You may remember how the government cash-for-clunkers program pushed a ton of auto sales into July and August last year. This resulted in a dip in sales immediately afterwards. But that was followed by a pretty nice recovery, with auto sales now up 20% from the first half of 2009. Stay tuned for housing.
The Mortgage Bankers Association's weekly survey showed purchase loan applications down from the week before, but refinance applications soared, equaling their May 2009 level. Mortgage rates, of course, continue at historically low levels.
>>> Review of Last Week
NOT SO BAD... Really???!!! Listening to the pundits who were fixated on last week's negative economic news, you might think things were awful. But as usual, the situation actually wasn't so bad, with the markets closing Friday with mixed results. The Dow and the S&P 500 dropped for the week, but far less than the week before. And the third major index, the Nasdaq, was UP 0.3%, so there are plenty of investors not paying that much attention to fretful pundits.
Make no mistake, the week did have its disappointments. The housing starts and building permits covered above were not cheered on Wall Street. Then, initial weekly jobless claims came in at 500,000, a bit over estimates and higher than they've been for a while. On top of that, the Philadelphia Fed index of manufacturing was down for the month, instead of up as expected, indicating a souring of the outlook in that region.
But wait just a minute. Mortgage refinancings took off, helping consumers and lenders. The Empire State index showed manufacturing in the New York region UP to 7.1 in August from 5.1 in July and suggesting more rapid growth to come. July Industrial Production and Capacity Utilization moved up nicely. Corporations continued to deliver strong profits and we even had renewed M&A action, with Intel buying McAfee for a cool $7.7 billion in cash. None of these are bad economic signs.
Yet for the week, the Dow ended down 0.9%, to 10213.62; the S&P 500 was down 0.7%, to 1071.69; but the Nasdaq was UP 0.3%, to 2179.76.
The bond market had a generally decent time of it, with the less encouraging economic data bringing in safe haven investors. Treasuries did well, while the FNMA 30-year 4.0% bond we watch ended down 13 basis points on Friday, closing at $102.15. Freddie Mac's weekly survey of conforming mortgage rates showed national average rates at historically low levels for yet another week.
>>> This Week’s Forecast
JULY HOME SALES, ANOTHER LOOK AT Q2 GDP...This is the week for July housing. Tuesday's Existing Home Sales are expected to be down from June, coming off the end of the home buyer tax credits. But Wednesday's July New Home Sales could be a tick above June. Friday we get the Q2 GDP Second Estimate. This should reflect the economic soft patch we're going through, as growth is expected to slow to the 1.5% territory.
>>> The Week’s Economic Indicator Calendar
Weaker than expected economic data tends to send bond prices up and interest rates down, while positive data points to lower bond prices and rising loan rates.
Economic Calendar for the Week of August 23 – August 27
>>> Federal Reserve Watch
Forecasting Federal Reserve policy changes in coming months. Economists haven't changed their belief that the Fed meant what it said in its pledge to keep rates "exceptionally low" for an "extended period." That period is now seen to extend well into next year. Note: In the lower chart, a 1% probability of change is a 99% certainty the rate will stay the same.
Current Fed Funds Rate: 0%–0.25%
Probability of change from current policy:
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© 2010 PrimeLending, A PlainsCapital Company. Trade/service marks are the property of PlainsCapital Corporation, PlainsCapital Bank, or their respective affiliates and/or subsidiaries. Some products may not be available in all states. This is not a commitment to lend. Restrictions apply. All rights reserved. PrimeLending, A PlainsCapital Company (NMLS no: 13649) is a wholly-owned subsidiary of a state-chartered bank and is an exempt lender in the following states: AK, AR, CO, DE, FL, GA, HI, ID, IA, KS, KY, LA, MN, MS, MO, MT, NE, NV, NY, NC, OH, OK, OR, PA, SC, SD, TN, TX, UT, VA, WV, WI, WY. Licensed by: AL State Banking Dept.- consumer credit lic no. MC21004; AZ Dept. of Financial Institutions- mortgage banker lic no. BK 0907334; CA Dept. of Corporations- lender lic no. 4130996; CT Dept. of Banking- lender lic no. ML-13649; D.C. Dept. of Insurance, Securities and Banking- dual authority lic no. MLO13649; IL Dept. of Financial and Professional Regulation- lender lic no. MB.6760635; IN Dept. of Financial Institutions- sub lien lender lic no. 11169; ME Dept. of Professional & Financial Regulation- supervised lender lic no. SLM8285; MD Dept. of Labor, Licensing & Regulation- lender lic no. 11058; Massachusetts Division of Banking– lender & broker license nos. MC5404, MC5406, MC5414, MC5450, MC5405; MI Dept. of Labor & Economic Growth- broker/lender lic nos. FR 0010163 and SR 0012527; NH Banking Department- lender lic no. 14553-MB; NJ Dept. of Banking and Insurance-lender lic no. 0803658; NM Regulation and Licensing Dept. Financial Institutions Division- lender license no. 01890; ND Dept. of Financial Institutions- money broker lic no. MB101786; RI Division of Banking- lender lic no. 20102678LL and broker lic no. 20102677LB; TX OCCC Reg. Loan License- lic no. 7293; VT Dept. of Banking, Insurance, Securities and Health Care Administration- lender lic no. 6127 and broker lic no. 0964MB; WA Dept. of Financial Institutions-consumer lender lic no. 520-CL-49075. PrimeLending, A PlainsCapital Company is an Equal Housing Opportunity Lender
Let the mail deliver more visitors to your website!
What's the best way to drive traffic to your website? Social marketing has potential but takes effort to make it work. PPC (pay-per-click) and banner ads vary in their effectiveness. Then what about good old direct mail?
People think the online and off-line worlds don't mix, when in fact they can work very well together. Research last year revealed that direct mail influenced 76% of Web users to buy a product or service online. And remember, direct mail offers dependable, direct access to almost everyone in your target audience.
Here are some tips for using direct mail to drive Web traffic:
Make a great offer. Don't just ask someone to visit your site--give them a good reason. Offer a free trial, seminar, white paper, coupons, or a sample of what you do. Make it something they want, not just something you want to talk about.
Create a special landing page. You may not want to send someone to your homepage with all the choices they'll find there. Instead, drive them to a unique landing page where you can target the message, track response, and get user data for follow-up efforts.
Get their contact information. Make sure your landing page asks for the visitor's email address. With a good enough offer, you might also get them to give you their full name, mailing address, and other info you want for your database.
Give them an easy-to-enter URL. Direct mail doesn't let you give users a clickable link, just a URL they have to type into a browser. So make it short and easy to spell. If you give the promotion its own domain, the URL could be really short. If you still want the landing page on your site, you can redirect the unique URL to go there.
Try pURLs. These are personalized URLs that grab attention by using the person's name, for example: JaneDoe.yoursite.com. This makes tracking the direct mail piece easy.
Personalize the copy. Like the pURL, teasers, headlines, or copy with the person's name will get their attention. The trick is to use this approach sparingly, so you don't wind up sounding like a sweepstakes.
End with a clear call to action. Be specific. Say something like "Go to JohnDoe.yoursite.com and register to download this valuable information."
Don't forget the deadline. Deadlines push people to respond immediately. That's why direct marketers use them.
You may need help from a Web expert to set up a special landing page, new URLs, and pURLs. But once you marry your off-line communications to your online presence, you may be surprised at what an integrated marketing approach will do for you.... Have a great month!
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© 2010 PrimeLending, A PlainsCapital Company. Trade/service marks are the property of PlainsCapital Corporation, PlainsCapital Bank, or their respective affiliates and/or subsidiaries. Some products may not be available in all states. This is not a commitment to lend. Restrictions apply. All rights reserved. PrimeLending, A PlainsCapital Company (NMLS no: 13649) is a wholly-owned subsidiary of a state-chartered bank and is an exempt lender in the following states: AK, AR, CO, DE, FL, GA, HI, ID, IA, KS, KY, LA, MN, MS, MO, MT, NE, NV, NY, NC, OH, OK, OR, PA, SC, SD, TN, TX, UT, VA, WV, WI, WY. Licensed by: AL State Banking Dept.- consumer credit lic no. MC21004; AZ Dept. of Financial Institutions- mortgage banker lic no. BK 0907334; CA Dept. of Corporations- lender lic no. 4130996; CT Dept. of Banking- lender lic no. ML-13649; D.C. Dept. of Insurance, Securities and Banking- dual authority lic no. MLO13649; IL Dept. of Financial and Professional Regulation- lender lic no. MB.6760635; IN Dept. of Financial Institutions- sub lien lender lic no. 11169; ME Dept. of Professional & Financial Regulation- supervised lender lic no. SLM8285; MD Dept. of Labor, Licensing & Regulation- lender lic no. 11058; Massachusetts Division of Banking– lender & broker license nos. MC5404, MC5406, MC5414, MC5450, MC5405; MI Dept. of Labor & Economic Growth- broker/lender lic nos. FR 0010163 and SR 0012527; NH Banking Department- lender lic no. 14553-MB; NJ Dept. of Banking and Insurance-lender lic no. 0803658; NM Regulation and Licensing Dept. Financial Institutions Division- lender license no. 01890; ND Dept. of Financial Institutions- money broker lic no. MB101786; RI Division of Banking- lender lic no. 20102678LL and broker lic no. 20102677LB; TX OCCC Reg. Loan License- lic no. 7293; VT Dept. of Banking, Insurance, Securities and Health Care Administration- lender lic no. 6127 and broker lic no. 0964MB; WA Dept. of Financial Institutions-consumer lender lic no. 520-CL-49075. PrimeLending, A PlainsCapital Company is an Equal Housing Opportunity Lender
Avoid the Internet's prying eyes!
Virtually every major website you visit employs surveillance technology to track your activity online. But you can limit their ability to snoop with just a little effort.
First, some background. Websites track your browsing activities with things called "cookies," "beacons," and "Flash cookies." These are small computer programs or files that the Web pages you visit install on your computer. Some of them can be helpful, saving you the trouble of continually logging in at frequently visited sites. But some are just for the website's benefit. So-called "third party" cookies and beacons will track your online activities as you go from site to site, to create a database marketers will use.
Welcome to the world of privacy. Privacy features are offered by all the major browsers, including Internet Explorer, Firefox, Safari, and Chrome. To make sure you're getting all the privacy options, upgrade to the latest version of your browser. Then here's what to do:
• Check and delete cookies. All major browsers let you see and delete the cookies installed on your computer. How this is done varies, so check the different tabs on your menu bar, such as Tools, Internet Options, and even General Settings. You'll probably find a huge list of cookies, so deleting all could be the best approach, although it could mean you'll have to re-enter log-in info at your favorite sites.
• Adjust browser settings. After deleting the old cookies, you can then control how many new ones get installed. The popular browsers allow you to accept cookies that keep your log-ins and settings for favorite sites, but block "third party" cookies that track your moves all over the net. Safari blocks these automatically, but other browsers need to be manually set. If you block all cookies, you'll have to log in every time you visit a site that requires it.
• Turn on "private browsing." The "private browsing" mode on all the big browsers will limit your cookies. Internet Explorer has this feature only on its latest IE8 version and Chrome labels it "Incognito." Private browsing deletes cookies every time you turn it off or close the browser, but all of the history goes, including those helpful log-in cookies. That's why some people like to use private browsing only for special web searches, such as for health-related or financial account information.
• Monitor Flash cookies. These are cookies that use Adobe's Flash program to save info on your computer. Flash is a popular way to present online video, so these cookies can be useful for remembering your video settings. But Flash cookies also allow marketers to track your online activity. To view these cookies and adjust settings, go to: www.macromedia.com/support/documentation/en/flashplayer/help/settings_manager.html. Be aware that some sites won't let you watch videos or other content if these third-party cookies are blocked.
• Beat those beacons. You can get help controlling beacons at http://www.ghostery.com/. There you can download an "add-on" or "plug-in" that will let you know if there's a beacon on the page you're viewing. Blocking features vary by browser, so check the Ghostery site for all the details.
• Op out of advertising. You can block or limit the ads you receive with the following online tools:
Opt out of about 50 ad networks at http://www.networkadvertising.org/. You won't see ads from the member networks, but you will still get others.
Block up to 152 ad networks at www.privacychoice.org/choose. You can opt out of most of them by just clicking a button, but some will ask you to download a plug-in that works only with Firefox.
Good luck keeping your online experience as private as possible! And, as always, please feel free to contact us at any time about any matters relating to home financing or refinancing.
... Have a great day!
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© 2010 PrimeLending, A PlainsCapital Company. Trade/service marks are the property of PlainsCapital Corporation, PlainsCapital Bank, or their respective affiliates and/or subsidiaries. Some products may not be available in all states. This is not a commitment to lend. Restrictions apply. All rights reserved. PrimeLending, A PlainsCapital Company (NMLS no: 13649) is a wholly-owned subsidiary of a state-chartered bank and is an exempt lender in the following states: AK, AR, CO, DE, FL, GA, HI, ID, IA, KS, KY, LA, MN, MS, MO, MT, NE, NV, NY, NC, OH, OK, OR, PA, SC, SD, TN, TX, UT, VA, WV, WI, WY. Licensed by: AL State Banking Dept.- consumer credit lic no. MC21004; AZ Dept. of Financial Institutions- mortgage banker lic no. BK 0907334; CA Dept. of Corporations- lender lic no. 4130996; CT Dept. of Banking- lender lic no. ML-13649; D.C. Dept. of Insurance, Securities and Banking- dual authority lic no. MLO13649; IL Dept. of Financial and Professional Regulation- lender lic no. MB.6760635; IN Dept. of Financial Institutions- sub lien lender lic no. 11169; ME Dept. of Professional & Financial Regulation- supervised lender lic no. SLM8285; MD Dept. of Labor, Licensing & Regulation- lender lic no. 11058; Massachusetts Division of Banking– lender & broker license nos. MC5404, MC5406, MC5414, MC5450, MC5405; MI Dept. of Labor & Economic Growth- broker/lender lic nos. FR 0010163 and SR 0012527; NH Banking Department- lender lic no. 14553-MB; NJ Dept. of Banking and Insurance-lender lic no. 0803658; NM Regulation and Licensing Dept. Financial Institutions Division- lender license no. 01890; ND Dept. of Financial Institutions- money broker lic no. MB101786; RI Division of Banking- lender lic no. 20102678LL and broker lic no. 20102677LB; TX OCCC Reg. Loan License- lic no. 7293; VT Dept. of Banking, Insurance, Securities and Health Care Administration- lender lic no. 6127 and broker lic no. 0964MB; WA Dept. of Financial Institutions-consumer lender lic no. 520-CL-49075. PrimeLending, A PlainsCapital Company is an Equal Housing Opportunity Lender
