Why the Fed Cut may not improve mortgage rates

Don't shoot the messenger

One of the most widely misunderstood dynamics of my business is the belief that a Fed rate cut immediately lowers mortgage rates.  Well, I hate to break it to you, but the Fed doesn't touch mortgage rates; however they make monetary policy changes that shake our world and yes... interest rates.  So allow me to support my "click-bait" headline with some comments and fact. 

The main fact is that the Fed doesn't directly touch mortgage rates.  The Fed sets a target for the "fed funds rate" after reviewing mountains of current economic data. The rate that they tweak is the interest rate banks charge each other for overnight loans. Those loans are called fed funds, which lowers the as the Fed lowers interest rates.  This change, albeit small or great, has great impact on the markets.  But the way it moves mortgage rates is quite the conundrum.  I'll explain... 

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Explaining July 4th to your kids

Never taken for granted

The freedoms we have in this country are unmatched in any other country.  I found this really good video which I plan to share with my kids today.  I even got something from the simplicity of explanation.  Although I feel our country has gotten away from many of the values established by our founding fathers, it is still a wonderful God given gift to live here in the United States of America.  I appreciate every day the freedoms we enjoy.  Enjoy the video... and share the simple story with a young one today!

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17 Amazing D-Day Quotes

I'm not the only one who is thankful

Today is the 75th anniversary of D-Day, Operation Overlord, the day during World War II on which the Allies (American, British & Canadian) invaded France.  It's hard for me to wrap my mind around the scope and the risk of that day.  One thing I know... I'm so thankful and I'm not the only one. 

4,414 Allied soldiers were killed and more than 9,000 wounded or missing. Since such a small percentage of World War II veterans are still alive, this could be the last time we can really honor any significant number of participants in the invasion.

17 Amazing Quotes on D-Day

I was going to write what this day means to me and perhaps I could do this day some justice, but I thought it best to showcase the thoughts and words of those that experienced this momentum day first hand.  Thanks to our friends at Inc. Magazine for the compiling of these great quotes.

1. "We'll start the war from right here."
--Brigadier General Theodore Roosevelt Jr., son of the former president, who landed with his troops in the wrong place on Utah Beach

2. "If any blame or fault attaches to the attempt, it is mine alone."
--General Dwight Eisenhower, future president, in a draft or remarks he'd made in case the invasion was a failure.

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3. "Hitler made only one big mistake when he built his Atlantic Wall. He forgot to put a roof on it." 
--World War II U.S. paratrooper aphorism

4. "They fight not for the lust of conquest. They fight to end conquest. They fight to liberate." 
-- President Franklin D. Roosevelt's official address announcing the invasion.

5. "So much of the progress that would define the 20th century, on both sides of the Atlantic, came down to the battle for a slice of beach only six miles long and two miles wide." 
--President Barak Obama, 10 years ago, in Normandy to mark the 65th anniversary of D-Day.

6. "The waiting for history to be made was the most difficult. I spent much time in prayer. Being cooped up made it worse. Like everyone else, I was seasick and the stench of vomit permeated our craft." 
--Private Clair Galdonik

7. "They're murdering us here. Let's move inland and get murdered."
--Colonel Charles D. Canham, 116th Infantry Regiment commander, on Omaha Beach 

8. I don't feel that I'm any kind of hero. To me, the work had to be done. I was asked to do it. So I did. When I lecture kids I tell them the same thing."
--Private First Class Joe Lesniewski

9. "You get your ass on the beach. I'll be there waiting for you and I'll tell you what to do. There ain't anything in this plan that is going to go right."
--Colonel Paul R. Goode, in a pre-attack briefing to the 175th Infantry Regiment, 29th Infantry Division

10. "At the core, the American citizen soldiers knew the difference between right and wrong, and they didn't want to live in a world in which wrong prevailed. So they fought, and won, and we all of us, living and yet to be born, must be forever profoundly grateful."
--Author Stephen Ambrose

11. "Today, when people thank me for my service, I figure three years of my time is a cheap price to pay for this country. Nobody owes me a thing."
--Lieutenant Buck Compton

12. "The first time I saw a poster wanting men to sign up to be paratroopers and heard how hard it would be to make it in, I knew that was for me. I wanted an elite group of soldiers around me."
--Staff Sergeant Frank Soboleski 

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13. "There is one great thing that you men will all be able to say after this war is over and you are home once again. ... When you are sitting by the fireplace with your grandson on your knee and he asks you what you did in the great World War II ... you can look him straight in the eye and say, 'Son, your Granddaddy rode with the Great Third Army and a son-of-a-goddamned-bitch named Georgie Patton!' " 
--General George S. Patton

14. "I'm very disappointed, and I hate leaving the world feeling this way."
--Private Jack Port, now 97, on the state of the world currently

15. "It was a different world then. It was a world that requires young men like myself to be prepared to die for a civilization that was worth living in."
--Harry Read, British D-Day veteran who jumped again this week with the British Parachute Regiment's freefall display team.

16. "I cherish the memories of a question my grandson asked me the other day when he said, 'Grandpa, were you a hero in the war?' Grandpa said 'No, but I served in a company of heroes.'"
--Major Richard Winters

17. "All I could see was water, miles and miles of water. But this was D-Day and nobody went back to England and a lot of infantry riding in open barges seasick to the low-tide beaches were depending on us to draw the Germans off the causeways and gun batteries, and so, as Porter hurled himself against me, I grabbed both sides of the door and threw myself at the water."
--Private David Kenyon Webster, who became a writer after the war

Thank You

To anyone that serves, served or knew someone that did... Thank You.  The past and current sacrifices are why we enjoy the freedoms we have today.

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Memorial Day Memories

I remember

So many things come to mind as I remember the great sacrifice of the men and women of our country.  I've had the honor to serve those who serve for the past 25 years in the field of mortgage finance.  Many that I knew have paid the ultimate cost so that we can live free in this country.  So, to all those who serve and have served... thank you.

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China retaliates... mortgage rates drop

The Headline was pretty somber

China is raising tariffs on $60 billion of US goods starting June 1.  The markets are selling off.  As of 9:27am, the futures are down over 500 and the stock markets are set to slide again for the second week in a row.

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Rates are trending higher

 
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Are interest rates going up?

We may be in for an Interest Rate crash

Rates have been going in the right direction for quite a while and I don't see the air leaking out of the tires just yet; however as I'll explain, the charts make me nervous! 

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February Home Sales Jumped to an 11-Month High

It’s good to get data from all over. But somehow when you get it from the U.S. Census Bureau and the U.S. Department of Housing and Urban Development, it seems even more official.

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MEETING YOUR NEIGHBORS NEVER GOES OUT OF STYLE!

In new home neighborhoods when homebuyers are seeing moving vans around them with regularity, it’s not unusual for people to meet one another while emptying boxes or comparing notes on floor plans and upgrades. Everyone is new and has a lot in common right off the bat. But when you move into an established neighborhood, it’s more of a challenge to meet your neighbors.

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A MORE BALANCED REAL ESTATE MARKET MAY BE IN OUR FUTURE!

The real estate tide is turning, according to Fortune Magazine’s Chris Morris. What was once a seller's market, complete with frenzied offers and multiple bidding, is beginning to smooth a bit, becoming what Realtors refer to as a “balanced market” where homes stay on the market a tad longer, and buyers actually have a chance to negotiate.

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