MMG Weekly 10/17/17

Guy R. Vetrano NMLS# 183357
Senior Loan Officer
Bay Equity Home Loans
Phone: 480.500.6000 x 6017
Mobile: 602-692-7196
gvetrano@bayeq.com
www.vetranoteam.com

In This Issue  
Last Week in Review: Retail Sales were in positive territory in September while consumer and wholesale inflation ticked up.

Forecast for the Week: Regional manufacturing and housing data dominate the week.

View: Maintain your credibility after an email oops.


Last Week in Review  
“Oh what a price I had to pay.” Fats Domino. Consumers weren’t afraid to spend in September after holding back in August.

Folks were spending in September, according to the most recent Retail Sales report issued by the Commerce Department. This was welcome news, as consumer spending makes up about two-thirds of the U.S. economy. Sales were up 1.6 percent from August, just below expectations, and up 4.4 percent from September 2016. Increases in gas, auto and building material sales led the way due to hurricane-related boosts. When stripping out autos, sales rose a solid 1 percent in September from August.

The Bureau of Labor Statistics reported that consumer inflation via the Consumer Price Index (CPI) jumped 0.5 percent in September from August, though this was softer than expected. However, the more closely watched Core CPI, which excludes volatile food and energy, was up just a meager 0.1 percent in September. This left year-over-year Core CPI at 1.7 percent for the fifth month in a row, meaning it still remains below the Fed’s inflation target of 2.0 percent.

Wholesale inflation also ticked up in September as energy prices rose following Hurricane Harvey. The Producer Price Index (PPI) rose 0.4 percent from August, in line with estimates, while annual PPI jumped 2.6 percent, the biggest gain since February 2012. Core PPI, which strips out volatile food and energy, rose 0.2 percent as expected from August to September, while the annual Core PPI was up 2.1 percent.

The Federal Open Market Committee meeting minutes from August revealed the Fed said the economy is strong enough to withstand an increase to the Fed Funds Rate later this year. This is the rate banks lend to one another overnight. However, the Fed will be closely watching inflation readings and other key economic reports in the coming weeks and months, and it remains to be seen if any data will impact this decision.

At this time, home loan rates remain historically attractive.

If you or someone you know has questions about home financing or home loan rates please contact me. I’d be happy to help.


Forecast for the Week  
Manufacturing and housing data dominate the week.
  • Regional manufacturing data from the Empire State Index will be released on Monday, followed by the Philadelphia Fed Index on Thursday.
  • Look for housing numbers on Wednesday with the release of Building Permits and Housing Starts.
  • The Fed’s Beige Book will also be delivered on Wednesday.
  • As usual, weekly Initial Jobless Claims will be released on Thursday.
  • Existing Home Sales close out the week on Friday.
Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve. In contrast, 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. When Bond prices 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 are 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 Bond prices got a boost in the second half of the week. Home loan rates remain near historic lows.

Chart: Fannie Mae 3.5% Mortgage Bond (Friday Oct 13, 2017)
Japanese Candlestick Chart

The Mortgage Market Guide View…  
5 Ways to Deal With an Email “Oops”

Unfortunately, there are many ways email can go wrong in either a single communication or a full-database send. Web links can be broken, a test email can be sent by mistake or information might simply be incorrect. In any case, you’ll want to act fast but don’t panic. Follow these best practices for dealing with an email “oops.”

Limit the problem if possible. Once an error is discovered, determine if the send can be paused or stopped, so it doesn’t reach an entire database. If a link is incorrect, determine if the destination link can be changed on the website or on social media to match the email link, so recipients still get to the correct page without having to notify them of the error.

Find a typo or spelling error in your email? Review the severity of the error to determine if a resend is warranted. For example, was a phone number transposed, which would make it difficult for the recipient to reach you?

Craft your apology. Don’t simply correct the email and resend a new version without explanation. Set the tone of your apology based on your relationship with your audience as well as the severity of the error. If a mistake is relatively minor, use light humor. For mistakes that seriously damage your credibility, offer reassurances of the steps you are taking to ensure the mistake doesn’t happen again.

Use the subject line to acknowledge the error. There are many subject line samples that can address most situations. For example:

  • Subject: Corrected Date/Link/Address/Version Included
  • Subject: Oops! We Made a Mistake/Oops! We Meant to Say …
  • Subject: Sorry! Spreadsheet Attached to This Email
Avoid future mistakes by developing an email checklist everyone can follow to ensure consistent success.

Source: GetResponse

Economic Calendar for the Week of October 16 – October 20
Date
ET
Economic Report
For
Estimate
Actual
Prior
Impact
Mon. October 16
08:30
Empire State Index
Oct
21
24.4
Moderate
Wed. October 18
08:30
Building Permits
Sep
1225K
1300K
Moderate
Wed. October 18
08:30
Housing Starts
Sep
1160K
1180K
Moderate
Wed. October 18
02:00
Beige Book
Oct
NA
NA
Moderate
Thu. October 19
08:30
Jobless Claims (Initial)
10/14
236K
243K
Moderate
Thu. October 19
08:30
Philadelphia Fed Index
Oct
20
23.8
HIGH
Fri. October 20
10:00
Existing Home Sales
Sep
5.29M
5.35M
Moderate
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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.
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