Ever wonder what drives mortgage rates?

The chart below is an easy to understand explanation of the factors that drive rates and how the market responds ...

Breaking News ... (RATE ALERT)

Consumer Confidence missed the mark ... Came in better than expected and this is a NEGATIVE FOR PRICING/RATES ... 

Consumer Confidence: 82.3 vs est 78.6, this will pressure pricing to the negative.

Richmond Fed Manufacturing -7 vs est of -1..worse than expected but not a factor in pricing.

New Home Sales at 440K vs est of 445K..very close to the mark, not a factor in pricing.

Robert F. Rosenbaum, Jr. 
The Rosenbaum Lending Group
1st Portfolio Lending Corp.
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Vienna, VA 22182
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RRosenbaum@FirstPortfolio.com
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Licensed in DC MD VA DE and PA
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This week in the mortgage markets ...

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Bob Rosenbaum, Jr. 1st Portfolio Lending Corp. The Rosenbaum Lending Group Phone: (703) 879-5200 Cellular (703) 608-1110 NMLS: # 649782 Bob@MyTalentedLender.com www.MyTalentedLender.com

In This Issue   Last Week in Review: The harsh winter weather throughout much of the country had a big impact on the housing market. Plus, the Fed met. Forecast for the Week: Housing reports will be front and center, along with key news on inflation, economic growth, and consumer attitudes. View: Sharing local statistics with clients and referral partners is easy with this resource. Last Week in Review   Time for a change. With spring officially here, the change of season will hopefully lead to a change of direction for the housing market, as the harsh winter weather contributed to several disappointing reports. February Existing Home Sales fell by 0.4 percent from January to 4.60 million units on an annualized basis. While this number was in line with estimates, it was 7.1 percent below the 4.95 million units registered in February 2013. The National Association of Realtors cited the unusually harsh winter weather, tightening of credit, and higher home prices as the cause behind the stagnant sales data. The harsh weather was also blamed for the weak Housing Starts reading for February, which came in at 907,000, making this the third straight monthly decline. In addition, the National Association of Home Builders Housing Market Index came in at 47 for March. Readings below 50 indicate that more builders view conditions as poor, rather than good. On a positive note, Building Permits, which are a sign of future construction, surged by 7.5 percent to 1.018 million. It will be important to see if readings improve once the weather becomes milder around the nation. In other news to note, weekly Initial Jobless Claims rose by 5,000 in the latest week to 320,000. Claims continue to hover near lows seen in November, as the labor markets work through the post-recession malaise. The 4-week moving average, which irons out seasonal abnormalities, came in at 327,000, the lowest level since the end of November. What does this mean for home loan rates? Despite some weaker than expected economic reports, the Fed announced more tapering to its Bond buying program. Beginning in April, the Fed will purchase $30 billion in Treasuries and $25 billion in Mortgage Bonds (the type of Bonds on which home loan rates are based) to help stimulate the economy and housing market. This is down from the original $85 billion per month that the Fed had been purchasing. I will be watching closely to see how this decision impacts the markets and home loan rates as we head further into spring. The bottom line is that now remains a great time to consider a home purchase or refinance, as home loan rates remain attractive compared to historical levels. Let me know if I can answer any questions at all for you or your clients. Forecast for the Week   This week's economic calendar is packed with important data on housing, inflation, and economic growth. Housing data is plentiful this week with the S&P Case-Shiller Home Price Index and New Home Sales being reported on Tuesday. Pending Home Sales follows on Thursday. We'll get a read on consumer attitudes towards the U.S. economy with Consumer Confidence on Tuesday and the Consumer Sentiment Index on Friday. Wednesday brings February's Durable Goods Orders, which are orders for items that last for an extended period of time. Weekly Initial Jobless Claims will be released as usual on Thursday. Also look for the final reading of Gross Domestic Product for the fourth quarter of 2013. Ending the week, the inflation-reading Personal Consumption Expenditures data along with Personal Income and Personal Spending will be delivered on Friday. 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. The chart below shows Mortgage Backed Securities (MBS), which are the type of Bond on which home loan rates are based. When you see these Bond prices moving higher, it means home loan rates are improving – and when they are moving lower, home loan rates are getting worse. To go one step further – a red "candle" means that MBS worsened during the day, while a green "candle" means MBS improved during the day. Depending on how dramatic the changes were on any given day, this can cause rate changes throughout the day, as well as on the rate sheets we start with each morning. As you can see in the chart below, Mortgage Bonds worsened after the Fed meeting but were able to stabilize. Home loan rates remain near historic best levels and I will continue to monitor them closely. Chart: Fannie Mae 4.0% Mortgage Bond (Friday March 21, 2014) The Mortgage Market Guide View...   Health Website Makes Sharing Local Data Easy Gone are the days of extensive research, compiling information, and sharing numerous website links in order to provide local stats and health data with relocating clients and prospects. Now, finding that information is quick and convenient with County Health Rankings. Through the collaboration of the Robert Wood Johnson Foundation and the University of Wisconsin Population Health Institute, the website brings together 50 diverse reports resulting in a health ranking for each county in the U.S. How Does Your Community Rank? 1. Visit www.countyhealthrankings.org. 2. Select your state from the map. 3. Once the state map appears, select your county. Within a few clicks, you can see your county's overall ranking, as well as other important local statistics such as: Population Unemployment Education Smoking and drinking Access to recreational facilities Air pollution Poverty Motor vehicle death rates Diabetes And much more! Check your local stats and feel free to pass this resource along to your team, clients, and colleagues. Economic Calendar for the Week of March 24 - March 28 Date ET Economic Report For Estimate Actual Prior Impact Tue. March 25 09:00 S&P/Case-Shiller Home Price Index Jan NA 13.4% Moderate Tue. March 25 10:00 Consumer Confidence Mar NA 78.1 Moderate Tue. March 25 10:30 New Home Sales Feb NA 468K Moderate Wed. March 26 08:30 Durable Goods Orders Feb NA -1.0% Moderate Thu. March 27 08:30 GDP Chain Deflator Q4 NA 1.6% Moderate Thu. March 27 08:30 Gross Domestic Product (GDP) Q4 NA 2.4% Moderate Thu. March 27 08:30 Jobless Claims (Initial) 3/22 NA NA Moderate Thu. March 27 10:00 Pending Home Sales Feb NA 0.1% Moderate Fri. March 28 08:30 Personal Income Feb NA 0.3% Moderate Fri. March 28 08:30 Personal Spending Feb NA 0.4% Moderate Fri. March 28 08:30 Personal Consumption Expenditures and Core PCE Feb NA 0.1% HIGH Fri. March 28 08:30 Personal Consumption Expenditures and Core PCE YOY NA 1.1% HIGH Fri. March 28 10:00 Consumer Sentiment Index (UoM) Mar NA 79.9 Moderate

Great article on changing habits

36 Lessons I’ve Learned About Habits

By Leo Babauta

I’ve learned these lessons the hard way.

I struggled to quit smoking in the early 2000s, failing seven times before finally succeeding in late 2005. I struggled with exercise habits, with changing my horrible eating habits, with waking earlier and being more productive and getting out of debt and simplifying my life.

I failed a lot, and still do. It was through those failures that these hard-fought lessons emerged, and so I don’t resent any of the failures. I recommend this attitude.

I’ve taught habits to thousands of people, in addition to changing dozens of my own. Teaching what I’ve learned to others taught me even more.

And still I’m learning. That’s the fun part.

Changing habits is one of the most fundamental skills you can learn, because it allows you to reshape your life. To reshape who you are. That’s truly transformational.

I share these lessons not as Commandments from On High, but as things you might try, in your journey of change and learning. Try them one or two at a time, so you’re not overwhelmed. Come back to this list after you’ve done that.

I hope they help.

1. When you make a small change, your ‘normal’ adjusts. Imagine that you’re used to a whole set of conditions — if you deviate from those conditions very much, you will be uncomfortable. Going to live in a foreign country where you don’t speak the language, don’t know anyone, aren’t used to the food, don’t understand the customs, don’t have the same kind of home you’re used to … this can be very difficult. But if you make one tiny change, it’s not very uncomfortable. And after a month or two, you adapt to this tiny change, and it becomes part of the conditions that you’re used to. Your new normal. Changing your life in small steps like this, one small change at a time, is much easier and much more likely to succeed than making multiple huge changes all at once. Gradually change your normal.
2. Small changes are easier to start. A big change not only requires your mental commitment, but more time and effort. If you already have your time tied up in other things, you’ll find it difficult to find the time to start your new habit. You might do it once or twice (go to the gym for an hour) but that habit is dead before it starts unless you put in an extraordinary effort. A small change — just a few pushups in the morning, for example — is much easier to get started. You could start it right now, in the middle of reading this article. Making it easy to start a habit means you’re more likely to actually do it.
3. Small changes are easier to sustain. If you start a big change (go to the gym for 30 minutes every day!), you might actually be able to start it with all the enthusiasm you have in the beginning. But that enthusiasm wanes, depending on energy and sleep levels, what else is going on in your life, disruptions in routine, etc. And eventually you’ll probably fail. But if you make the habit very small when you start, you are much much more likely to sustain it for longer. It’s easier to keep a small thing going than a big one. And keeping it going is what matters.
4. Habits are tied to triggers.When the trigger happens, the habit follows, if it’s been ingrained strongly as a habit. For example, for some people, when they arrive at work, they immediately turn on their computer. And then maybe immediately do another habit after that. The habit-trigger bond is strengthened from lots of repetitions.
5. Habits with variable or multiple triggers are harder. If you want to meditate every morning after waking and drinking your customary glass of water (for example), it’s much easier to create a habit like this with one daily trigger … as opposed to a habit that requires either 1) variable triggers, like not reacting angrily when someone criticizes you (you don’t know when that trigger will happen), or 2) several different kinds of triggers, such as smoking which might be triggered by stress or other people smoking or drinking alcohol or coffee, etc.
6. Learn to do easier types of habits first. If you try to do hard types of habits (like ones with variable or multiple triggers, or ones that you dislike or find very difficult), and you’re not skilled at creating habits, you’re much less likely to succeed. I highly recommend doing easy habits first, ones that only require a couple minutes a day, are tied to a single daily trigger, and that you enjoy and find easy. What’s the point of trying to form an easy habit? Well, you might find it harder than you think, but also, you’re building your habit skills, and most importantly, you’re building trust in yourself.
7. Build trust in yourself.What I lacked before I got better at changing habits was trust that I would stick to a habit. Why? Because I’d failed so often before, allowing myself to break promises to myself because it was easier than sticking to the promises. It’s like if another person constantly lies to you — you don’t trust that person anymore. The same is true of your promises to yourself. And the solution is the same — to build trust slowly, with small promises and small victories. This takes time. But it’s arguably the most important thing you can do.
8. Incremental changes add up to huge changes. This might seem to make sense on the surface, but I don’t think most people feel its truth in their gut. We all want all the changes we want, right now. We can’t possibly make ourselves give up a few of those changes for awhile, to focus on one, because then we wouldn’t get what we want, right now. I’ve seen this so many times — people want to make 10 changes at once, and can’t choose just one to focus on. But doing lots of changes at once, or big changes, means you are less likely to succeed. But if you stick with small changes, you’ll see some powerful long-term change. Try making small changes to your diet and activity levels — after a year, you’ll be way fitter than before. Try learning something a little at a time — if you can make it a habit and stick with it, you’ll be way better at it in six months. This is what I’ve seen in my life, and it’s been dramatic in scope.
9. It doesn’t matter which change you focus on first. We’re not in it for the short game, we’re in it for the long game. It can be hard to figure out which change to make right now, because that means giving up lots of other important changes. And I’ve seen people agonize over which change to make first, because they think the order matters. Sure, maybe it would be optimal to learn to meditate first, before making eating changes, but you know what’s not optimal? Making no changes. Over the long term, if you pick one small change at a time, you’ll have all the important habits formed. So honestly, just pick the one you feel like doing the most — the one that you’ll enjoy most.
10. Energy and sleep levels matter a lot. I wrote about this recently, but if you are sleep-deprived, you’ll be tired and have little energy to focus on habit changes. That’s fine when your enthusiasm for your new habit is high, but the moment things get even a little difficult, you’ll skip the habit because you don’t have the willpower to push yourself through a little discomfort. Sleep matters.
11. Dealing with disruptions in routine is a learned skill.One of the most common causes of habit failure is disruption in routine — taking a trip, having a big work project that requires you to work late, having visitors, having a cold. These kinds of things change your normal routines, which do a couple things to the habit you’re forming: 1) the trigger might not happen (if you’re sick you might not get up and shower, for example, if showering is your trigger), and 2) you might get so busy/tired that you don’t have time/energy to do the habit. So how do you deal with this obstacle? Anticipate it. Know that it will happen (yes, everyone’s routine gets disrupted). Plan to either take a break while you’re traveling (for example), or have a new trigger while your old one is temporarily disrupted. This kind of anticipation and planning is a skill that you can learn, and this skill makes you better at creating new habits.
12. Think ahead to avoid foreseeable obstacles.Other than disruptions to your routine, there are other things you can anticipate. For example, if you’re changing your eating habit (say, no sugar) and you’re going to a restaurant with friends or a birthday party, what will you eat? What will your strategy be if there’s sugar (which there will be)? If you forget about it and wait until it happens, you’ll be unprepared and less likely to stick to your habit. How and where will you work out when you travel? Anticipate and prepare.
13. Watch your self-talk. We all talk to ourselves. It’s just not always obvious, because the self-talk happens in the back of our heads, unnoticed most of the time. That’s normal, but when the self-talk is negative, it can absolutely ruin a habit change. If your self-talk is a series of things like, “This is too hard, I can’t do this, why am I making myself suffer, it’s OK to cheat, it’s OK to quit, this is too hard, I hate this” … you need to either catch it, or you’ll likely fail. You have to become aware of what you’re saying to yourself, and recognize that it’s not true. Then tell yourself things that are positive. This is a key habit skill.
14. Get good at watching but not acting on urges. When you see the urge to smoke, or eat a whole bag of Doritos, or not meditate, or procrastinate, or not go on your morning run … you can pause and watch it but not act on that urge. The urge usually goes unnoticed, and you just act on it. But you can watch it, and not act. You can give yourself a choice. At the moment you’re watching, dig deep and remember your powerful motivations.
15. Have powerful motivations. It’s easy to say, “Sure, I’d love to learn to program!” It sounds nice. But something that sounds nice isn’t going to stick when things get a little hard. You need to have a very strong motivation — wanting to have better health so you won’t suffer as much, wanting to create a good life for your kids, wanting to help people in need. Looking good is not a good motivator, but feeling strong and empowered is. Write your motivation down. Remind yourself of it when things get hard.
16. Use accountability to engineer positive & negative feedback loops.Feedback loops help steer you to doing a habit long enough for it to be ingrained as a habit … or they help steer you away from a habit. Sugar and drugs have feedback loops that are good for forming habits (you get pleasure from doing the habit, suffer if you don’t), while exercise often has the wrong feedback loops (it’s hard to do the habit, enjoyable to watch TV and skip the habit). However, we can re-engineer the feedback loops, and accountability is one of the best ways of doing that. If you’re going to meet a friend at 6am to go on a run, you’d feel really bad if you missed the run, and feel good about going on the run with your friend and enjoying the conversation. Boom. New feedback loop. Same thing when you blog about your habit to an audience, or join an accountability team.
17. Challenges work really well. Short-term challenges of 2-6 weeks can be really motivating. Maybe it’s a challenge between two people (you and a friend), or a group challenge. It’s a form of accountability that’s fun and, again, revises the feedback loop in a good way. Examples of challenges: no sugar for a month, work out every day for 21 days, stick to a diet for 6 weeks, etc.
18. Exceptions lead to more exceptions. It’s really easy to justify not doing your new habit (or doing an old habit you’re trying to quit) by saying, “Just one time won’t hurt.” Except that it will, because now you think it’s OK to make exceptions. And now you don’t really trust yourself to stick to your promise to yourself. It’s much more effective to not make exceptions — catch yourself if you’re thinking about it and trying to justify it, and remember your motivations. When I quit smoking, I told myself Not One Puff Ever (NOPE).
19. The habit is the reward — it’s not a chore. Adding external rewards can be a useful way to have good feedback for doing the habit, but the best possible reward is internal. The reward is doing the habit. Then you get the reward immediately, not later. For example, if you think exercise sucks, you’re getting bad feedback as you do the habit — you won’t stick to it for long. But if you can find ways to enjoy the exercise (do it with a friend, see the enjoyable aspects of exercise, play a sport that you love, go on a hike with awesome views, etc.) then you’re getting positive feedback as you do the habit. Change your thinking — the habit is lovely, a reward in and of itself, a way to care for yourself. Do not think of it as a chore you need to get done, or you’ll avoid it.
20. Lots of habits at once means you’ll probably fail.Go ahead and try an experiment: do 5 new habits at once. See how many you’re successful with. Then try one habit only, and see how long you stick to that. In my experiments, one habit is much more successful than two at a time, and exponentially more successful than 5-10 habits at once.
21. Recognize when you’re getting distracted. In the beginning, we can get very focused on a new habit, and have lots of energy to put into it. But other things can come up and we might find a new shiny toy to get excited about … and soon the old habit change is falling to the wayside. This has happened to me many times. Now, I’m not saying a habit needs to take up all your mindspace and free time. That’s not healthy either. But you should be able to focus on it for a small amount of time each day, and still enjoy it and look forward to it. If that’s falling away, re-examine your motivation and priorities, and either drop the habit or re-focus.
22. A blog is an amazing tool.As I said, accountability makes a huge difference in your habit’s feedback loops. Blogging is a great way to get accountability. And as you’re sharing what you’ve been doing and what you’re learning, you are forced to reflect on your habit, which makes what you learn about the habit and yourself a much deeper experience.
23. Failure is a learning tool.You will fail in your habit attempts — that’s a given. But instead of seeing it as a failure of you as a person (it’s not), see it as a way to learn about yourself and habit change. Each person is different — what works for me won’t necessarily work for you. And you won’t know until you try it and fail. When you fail, you learn something new, and that helps you get better.
24. How you deal with failure is key. When many people fail, they feel bad about themselves and give up. This is why they have such a hard time changing habits. If instead they got back up and tried again, perhaps with an adjustment to their method (some new accountability, for example), they’d obviously have a much higher chance of success. The people who succeed at habits aren’t people who never fail — they’re people who keep going after they fail.
25. Adjust or die. On a related note, habit change is about learning to adjust. New job? That will change things, so you’ll need to adjust your habit. Missed a few days? Figure out what’s going wrong and adjust. Habit isn’t enjoyable? Find a new way to make it enjoyable. Self-talk sabotaging your habit change? Focus on becoming aware of your self-talk so you can solve that problem. Adjust, adjust, adjust.
26. Enlist support. Who will you turn to when things get hard? When you need encouragement? When you fail? Have a support buddy — I had one when I was quitting smoking, and I’ve used it other times as well. If you start out without support, and fail, that’s OK — adjust by finding someone to help you. That might be your spouse or best friend or parent or sibling or co-worker. Or maybe you find a support group online. It makes a big difference.
27. You limit yourself. Lots of times I suggest people give up something like cheese or sugar or beer, at least for a little while. They respond: “I could never give up my cheese!” (or meat, or sweets, etc.) Well, that’s true if you believe it. However, I’ve learned that we often think we can’t do something when really we can. I recently talked to someone who was absolutely sure she couldn’t give up baked goods. She limits herself with this belief. We all do to some extent — but if you can examine your beliefs and be willing to test them out, you’ll often find out they’re not true.
28. Set up your environment for success. If you’re going to give up sweets, get rid of all the sweets in your house. Ask your spouse to support you by not making or buying sweets for a little while. Tell friends you’re not eating sweets and ask them to support you. Yes, this can require others to make adjustments, but if you ask nicely for their help, often they’ll be glad to support you. But the point is, find ways to create an environment where you’re likely to succeed. Create accountability, reminders, support, a lack of temptations and distractions, etc.
29. Just lace up your shoes & get out the door. Reduce the barrier to starting the habit. If I need to go for a run, often I’ll think about how hard it is, how long it will take, how cold it will be, etc., and I’ll psyche myself out and not do it. But when my rule is, “Just lace up my shoes and get out the door”, that’s so easy it’s hard to say no. That’s my bar. As easy as possible. Once I’m out the door, I’m invariably glad I started and things go well. For meditating, just get your butt on the cushion. For writing, just open up your writing program and write a sentence.
30. Define your breaks. If you’re going to be traveling and know that you can’t stick to your habit, for example, set the dates of your habit break in advance, rather than letting it slide and then thinking that you’ve failed. And have the date when you’re going to get back on track, and set a reminder so you don’t forget. This will keep a planned event from completely derailing your habit change.
31. Habits are situational. A habit is tied to a trigger, but really, the trigger is an environment. So if your trigger is your morning shower, that’s great, but it’s not the shower itself. The trigger is taking the shower in your home, getting out, seeing a something in your bathroom that somehow triggers the impulse to go and meditate (or whatever your habit is). So if you take a shower in a different bathroom in your house, or in a hotel, the trigger doesn’t happen. The same is true if you got a phone call as you got out of the shower, or your wife comes and gives you a hug, both disrupting the trigger. Anyway, there’s not much you can do with this info, as you can’t control all the things in your environment, but being aware of subtle environmental changes that affect your habit can help you to understand what’s going on.
32. Learn to cope in other ways. Often your bad habits are ways of coping with a real need — like needing to cope with stress or bad feelings about yourself or a fight with a loved one. The need to cope with these things won’t go away, and so bad habit becomes a crutch. You can find other ways of coping that are healthier, so you don’t need the crutch anymore. Read more.
33. Be kind to yourself. You will fail, and you can be hard on yourself and feel guilty and think that you’re crap. That won’t help at all. Being kind to yourself is a good habit skill, if you pair it with an adjustment that allows you to improve your habit method. To be kind to yourself: remind yourself of how hard it is to be happy, and that you’re struggling to find happiness despite things that cause you stress and frustration and anger and irritation and disappointment. This is hard. Have empathy with yourself. Be understanding and compassionate. It will help you as you adjust and try again.
34. Perfect is the enemy. Often people strive for perfection, but this stands in the way of progress. Progress is much more important than perfection. If you find yourself not starting a habit because you want the perfect circumstances, or not meditating because you want the perfect time or space, or not writing because you want the perfect tool, or not being happy because you haven’t been perfect with your habit — drop your expectations and just do the habit.
35. A workout partner works wonders. For exercise, the most effect method for me is to have a workout partner. That’s true whether I’m going to the gym, taking a Crossfit or yoga class, going for a run or hike. When I don’t have a workout partner, my frequency can often drop. This concept can be applied to any habit that you’re struggling with.
36. Habit changes are tools for self-learning. Habit changes aren’t just ways to add a new thing to your life. They’re tools for learning about yourself. Through habit change, you learn about what motivates you, about self-talk and rationalization, about urges, about internal vs. external rewards, about weaknesses and kindness, about progress and empowerment. You can learn more about yourself through a few months of habit change than you have in the last decade, if you pay attention. And in that way, habit change is an extremely rewarding process, regardless of the outcome.

Mortgage News

Forwarded exclusively by:	Bob Rosenbaum The Rosenbaum Lending Group Office: (703) 879-5200 Email: Bob@MyTalentedLender.com website: www.MyTalentedLender.com NMLS#: 649782
Wednesday, March 19, 2014
Daily Market Analysis What's on the agenda for today? MBS OVERVIEW The mortgage backed security world was not impacted by this morning's domestic economic data and was up only +4BPS in early trading as our 10 year Treasury note claws its way back to 2.700%. The Federal Reserve Open Market Committee (FOMC) starts two days of meetings and then will make their interest rate announcement and policy statement tomorrow afternoon. Today is once again all about Putin. The bond market is taking a very cautious breather this morning after Russian President Vladimir Putin stated that Russia is not looking to split up Ukraine further now that they will annex Crimea. The market was fearing that this would be a prolonged advance by Russia to take over the whole area (and it still could be) but for now....the market is calming down on his comments. TODAY'S EVENTS Building Permits: Broke back over a million (1.018M vs est of 960K). While actual Housing Starts just missed market expectations with a reading of 907K vs est of 910K, plus the prior period was revised upward. This looks to be fairly decent news for the Spring but not a major factor in MBS pricing today. Consumer Price Index: This morning's data was very tame which is great for bonds but it did match market expectations across the board so it has had little to no impact on pricing. Headline CPI hit 0.1% vs est of 0.1% and Core CPI was also 0.1% vs est 0.1%. Total Net TIC Flows: Treasury International Capital showed a lot of money flowing into the U.S. plus the prior reading was significantly improved. This is to be expected given the global uncertainty and not a factor in pricing today. What happened yesterday? MBS OVERVIEW There are no major economic releases today or Treasury auctions for the MBS traders to absorb. Today is all about the Fed. Well....it should be but unrest in Ukraine is still a significant factor in pricing. The Federal Reserve Open Market Committee (FOMC) concludes their two days of meetings and then will make their interest rate announcement and policy statement at 2:00EDT today. Most economists and bond traders believe that the Fed will taper an additional $10 billion. But the most volatility this afternoon could come from Janet Yellen's press conference following the FOMC statement. Her comments and answers to questions will give traders the ammunition that they need to try to front-run the Fed moving forward.
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Retail Sales

The Commerce Department reported on Thursday that after declining in December and January, Retail Sales rose by 0.3% in February as the nation begins the big thaw after the harsh winter weather. Retail Sales make up about 1/3 of consumer spending, the main driver behind economic growth.

The week ahead ...

Forwarded exclusively by:	Bob Rosenbaum The Rosenbaum Lending Group Office: (703) 879-5200 Email: Bob@MyTalentedLender.com website: www.MyTalentedLender.com NMLS#: 649782
Monday, March 10, 2014
Weekly Market Preview What's on the agenda for this week? MBS OVERVIEW Today the MBS (mortgage-backed securities) market will likely be flat, either slightly improved or slightly worse than it opens, but not enough to see rates move. MBS are very close to oversold, a technical indicator that improvement to pricing should be coming this week. However, the improvement we may see is likely not enough to see rates improve much at all, possibly .125% and maybe nothing at all. TODAY'S EVENTS There is no economic news today that will affect the MBS markets. Here are the reports being released through the rest of the week: What happened last week? MBS OVERVIEW Mortgage backed securities (MBS) lost -94 basis points (BPS) from last Friday's close which caused 30 year fixed mortgage rates to increase and more than wiped out the prior week's +75BPS gain. The market saw the lowest rates on Monday and the highest rates on Friday. The "flight to quality" into U.S. bonds primarily due to concern over the Ukraine helped MBS rally two weeks ago and last week MBS reversed course as the market's concern over Ukraine cooled off. This was the primary reason for the big sell off in MBS (which caused higher rates) on Tuesday. But we got another sell off on Friday which was due to domestic economic data. The market was prepared for a much weaker than expected reading in the Non-Farm Payrolls. The consensus estimates were for 139K with "whisper numbers" much lower than that. But the actual results surprised to the upside with a reading of 175K. Plus, the last two months were revised upward. This much better than expected labor data caused bond traders to accept that the Federal Reserve would continue on their predefined course of "tapering" or reducing the amount of monthly Treasury and mortgage backed security (MBS) purchases at each of their meetings. That caused mortgage rates to rise.
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Surprise Rise in Job Creation

Despite the harsh winter weather, employers created more jobs than expected in February. 

The Labor Department reported that Non-farm Payrolls rose by 175,000 last month, above the 163,000 expected. This was the largest gain in three months. 

The week ahead ...

Send to a Friend Follow Me On:       Bob Rosenbaum, Jr. 1st Portfolio Lending Corp. The Rosenbaum Lending Group Phone: (703) 879-5200 Cellular (703) 608-1110 NMLS: # 649782 Bob@MyTalentedLender.com www.MyTalentedLender.com   In This Issue           Last Week in Review: The housing market continues to bloom, but there was mixed news from other parts of the economy. Forecast for the Week: The labor market will be front and center this week, along with key inflation and manufacturing news. View: Navigating personal and professional posts on social media is easy with the etiquette tips below.           Last Week in Review           March comes in like a lion and goes out like a lamb. As March comes in this year, the housing sector continues to roar ahead with good news, while other sectors are struggling. Read on to learn the latest details, and what they mean for home loan rates. Despite the harsh weather, New Home Sales rose by 9.6 percent from December to January to an annual rate of 468,000, well above expectations. The 468,000 rate was the highest level since July 2008. Pending Home Sales for January also came in just above expectations and well above December's reading. In addition, research firm CoreLogic reported that completed foreclosures fell by 19 percent from January 2013 to January 2014, while the Case Shiller 20-city Home Price Index ended its best year since 2005. On the other end of the spectrum, the second reading for 2013 fourth quarter Gross Domestic Product (GDP) was, in a word, gross. GDP fell to 2.4 percent from the initial reading of 3.2 percent, sharply beneath the 4.1 percent recorded in the third quarter of 2013. The decline was due in part to consumer spending and exports that were less robust than initially thought, signaling U.S. economic growth remains choppy. However, there was some good news in the report as company spending was revised up sharply, suggesting an improvement in business conditions. In labor market news, weekly Initial Jobless Claims rose by 14,000 in the latest week, reaching a one-month high as the job markets continues their up and down pattern. The labor market has been choppy lately, especially after the anemic number of job creations in December and January. What does this mean for home loan rates? Remember that the Fed is now purchasing $35 billion in Treasuries and $30 billion in Mortgage Bonds (the type of Bonds on which home loan rates are based) to help stimulate the economy and housing market. This is down from the original $85 billion per month that the Fed had been purchasing. With the December and January job creation numbers far below expectations, the Fed will be looking closely at February's numbers for any signs of a pattern. If this report and other key economic data points are weak, the Fed may have to rethink the tapering it has begun. This story is sure to impact the markets and home loan rates as we move ahead in 2014. The bottom line is that now remains a great time to consider a home purchase or refinance, as home loan rates remain attractive compared to historical levels. Let me know if I can answer any questions at all for you or your clients.           Forecast for the Week           This week's economic calendar features a broad array of reports that span a big portion of the U.S. economy. Economic data kicks off on Monday with Personal Income, Personal Spending, and the inflation-reading Personal Consumption Expenditures. The ISM Manufacturing Index and the ISM Services Index will be released on Monday and Wednesday, respectively. Also on Wednesday, look for the Federal Reserve's Beige Book, which can serve as a helpful indicator to the Fed's decisions on monetary policy. In labor market news, the ADP Employment Report will be delivered on Wednesday, followed by weekly Initial Jobless Claims on Thursday. Worker Productivity will also be reported on Thursday. That leads us to Friday's Non-farm Payrolls and the Unemployment Rate, which will be closely dissected by both Wall Street and the Federal Reserve. 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. The chart below shows Mortgage Backed Securities (MBS), which are the type of Bond on which home loan rates are based. When you see these Bond prices moving higher, it means home loan rates are improving — and when they are moving lower, home loan rates are getting worse. To go one step further — a red "candle" means that MBS worsened during the day, while a green "candle" means MBS improved during the day. Depending on how dramatic the changes were on any given day, this can cause rate changes throughout the day, as well as on the rate sheets we start with each morning. As you can see in the chart below, Mortgage Bonds had a strong week thanks to investors and some weaker than expected reports. Home loan rates remain near historical lows and I will continue to monitor them closely. Chart: Fannie Mae 4.0% Mortgage Bond (Friday Feb 28, 2014)     The Mortgage Market Guide View...         How to Mix Professional, Personal Posts on Social Media How do you balance work and play in your social-media posts? By Susannah SniderSee my bio, Kiplinger.com Navigating between personal and professional posts on social media can be like walking through an etiquette minefield. Whether you're tweeting in 140 characters or posting family vacation photos to Facebook, it's tough to know which topics are off-limits. "The problem with social media is that it's relatively new," says etiquette consultant Jay Remer. "Using it properly hasn't really caught on yet." Should I even bother? Your gut reaction may be to abstain from social media and avoid the issue, but that's not always smart. Social media is a useful tool. It can promote your business and personal brand, and it can help you network. If you're not on Facebook, LinkedIn or Twitter, it may appear that you're out of touch to a client or recruiter searching your name online. The nuts and bolts of all these platforms are similar—you publish links, photos and comments—but the expectations are different. A LinkedIn account is for your professional life. Facebook and Twitter give you more wiggle room, with the tone of your posts and bio helping to define them as professional or personal. Remember that objective before each post to keep your profile on-topic and appropriate. If your feed is for personal purposes—keeping in touch with family and friends—then tighten your privacy settings. But private or not, remember that posts and photos can leak, so err on the conservative side. Can I connect with the boss? Yes, depending on the platform. For example, LinkedIn is almost always appropriate because the site is for professional contacts. Following a professional page on Facebook is fine (you'll recognize a professional profile by its "likes" or "followers"). But don't "friend" a boss or subordinate. Twitter falls somewhere in between, because professionals may use it for networking or posting work-related links and comments. Take a cue from the kind of content a co-worker posts. And if you don't feel comfortable accepting a "friend" or "follow" request from a co-worker, you don't have to accept it. Can I post personal updates on my professional account? You should – with a few caveats. A steady stream of professional posts can be boring and robotic. An occasional personal status update spices up and humanizes your feed. The trick is to draw the line between sharing and oversharing. Choose a topic or two—say, biking and music—and restrict lifestyle posts to those subjects. Your followers will know what kinds of personal updates to expect from you without feeling overwhelmed by intimate details. Reprinted with permission. All Contents ©2014 The Kiplinger Washington Editors.www.kiplinger.com. Economic Calendar for the Week of March 03 - March 07 Date ET Economic Report For Estimate Actual Prior Impact Mon. March 03 08:30 Personal Income Jan NA   0.0% Moderate Mon. March 03 08:30 Personal Spending Jan NA   0.4% Moderate Mon. March 03 08:30 Personal Consumption Expenditures and Core PCE Jan NA   0.1% Moderate Mon. March 03 08:30 Personal Consumption Expenditures and Core PCE Jan NA   1.2% Moderate Mon. March 03 10:00 ISM Index Feb NA   51.3 HIGH Wed. March 05 08:15 ADP National Employment Report Feb NA   175K HIGH Wed. March 05 10:00 ISM Services Index Feb NA   54.0 Moderate Wed. March 05 02:00 Beige Book Mar NA   NA Moderate Thu. March 06 08:30 Jobless Claims (Initial) 3/01 NA   NA Moderate Thu. March 06 08:30 Productivity Q4 NA   3.2% Moderate Fri. March 07 08:30 Non-farm Payrolls Feb NA   113K HIGH Fri. March 07 08:30 Unemployment Rate Feb NA   6.6% HIGH Fri. March 07 08:30 Average Work Week Feb NA   34.4 HIGH Fri. March 07 08:30 Hourly Earnings Feb NA   0.2% HIGH       The material contained in this newsletter has been prepared by an independent third-party provider. The content is provided for use by real estate, financial services and other professionals only and is not intended for consumer distribution. The material provided is for informational and educational purposes only and should not be construed as investment and/or mortgage advice. Although the material is deemed to be accurate and reliable, there is no guarantee it is without errors. As your mortgage professional, I am sending you the MMG WEEKLY because I am committed to keeping you updated on the economic events that impact interest rates and how they may affect you. Mortgage Market Guide, LLC is the copyright owner or licensee of the content and/or information in this email, unless otherwise indicated.   Mortgage Market Guide, LLC does not grant to you a license to any content, features or materials in this email.   You may not distribute, download, or save a copy of any of the content or screens except as otherwise provided in our Terms and Conditions of Membership, for any purpose.