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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: Knighty Tin who wrote (63041)	6/23/1999 12:26:00 PM
From: Mike M2	Respond to of 132070

Mike, my guess is AG wants to pass his mess on to his successor- I hope he fails -g- Mike

To: Knighty Tin who wrote (63041)	6/23/1999 1:51:00 PM
From: Peter Singleton	Read Replies (1) \| Respond to of 132070

MB, here's another article re: credit markets, this one on mortgage rates. once again, for us folks that don't know much about credit markets, this info sounds like it could easily be noise level stuff (rates go up, they go down, etc). How will we know when and if the credit market itself is doing the Fed's job for it, and taking away the punch bowl? Peter key quote: <<According to Freddie Mac, 30-year mortgage rates rose to an average 7.65 percent, the highest level since 7.85 percent in the week ended June 6, 1997 and up from 7.51 percent the previous week. That was the seventh straight week that 30-year mortgages were above 7 percent and the eighth week since they posted a decline.>> biz.yahoo.com Wednesday June 23, 1:17 pm Eastern Time U.S. home sales seen falling in May as rates rise By Aleksandrs Rozens NEW YORK, June 23 (Reuters) - Although U.S. existing home sales are expected to show a decline in May, higher U.S. borrowing costs do not automatically portend a huge downturn in demand for housing, economists said on Wednesday. Last week, Freddie Mac reported that average rates on U.S. 30-year fixed rate mortgages in the week ending June 18 jumped to their highest level in two years. Economists surveyed by Reuters expected May existing home sales to have edged down to an annualized level of 5.23 million from the previous month's 5.24 million unit level. ''Higher rates usually don't mean an immediate slowdown in sales,'' said Michael Carliner, economist at the National Association of Homebuilders, who expects existing home sales to be between 5.3 million and 5.4 million units on an annual basis. The economy is still quite strong, which will offset some of the negative effect of higher rates, reasoned Robert Van Order, chief economist at Freddie Mac. But, there ''could be a little erosion,'' he said. The National Association of Realtors will release the May U.S. existing home sales data on Friday at 1000 EDT/1400 GMT. According to Freddie Mac, 30-year mortgage rates rose to an average 7.65 percent, the highest level since 7.85 percent in the week ended June 6, 1997 and up from 7.51 percent the previous week. That was the seventh straight week that 30-year mortgages were above 7 percent and the eighth week since they posted a decline. Fannie Mae Senior Economist Robert Barr said higher rates suggest existing home sales will eventually decline, but a rise in mortgage borrowing costs often stirs consumers into action. ''The short-term dynamics are interesting: a sharp rise in rates compels people to hurry up and move,'' said Barr, who expects existing home sales to be at 5.4 million units. Barr said the eventual drop in demand for housing likely will be evident later in the summer or in the autumn of this year. ''I think we'll see that June's and July's numbers are slower if rates stay high,'' said Barr, adding that confidence still remains intact. Barr warned, however, that a weakening in the U.S. employment picture could dent U.S. consumer confidence enough to curtail home buyer appetites. While sales are expected to decline, Van Order pointed out that a sales level over five million remains a healthy pace. ''Five million is still a big rate,'' he said, adding that he expects May sales of existing homes to come in at about five million. Van Order warned that a rise in mortgage rates to over eight percent would significantly slow demand for mortgage loans.