Mortgage Weekly Update - Last Week in Review
Foster Weeks publishes a weekly mortgage report which is updated every Monday morning. How is this affecting the San Francisco real estate market? Read our weekly and monthly market reports."COMMEND A FOOL FOR HIS WIT, OR A ROGUE FOR HIS HONESTY, AND HE WILL RECEIVE YOU INTO HIS FAVOUR." Henry Fielding So honestly - was "rogue trader" Jerome Kerviel really solely responsible for costing French Bank Societe Generale $7.1 Billion Dollars...and for helping to trigger last week's massive sell-off in global Stock markets? Or is the junior trader being played a fool, becoming the scapegoat to cover up financial mismanagement by the bank itself?
Supposedly - the French Bank had just uncovered massive losing positions caused by Kerviel, and decided to start selling off or "unwinding" these losing positions last Monday. Particularly because our US markets were closed on Monday in observance of Martin Luther King Day and unable to help sop up some of the mess, global Stock markets declined significantly on the unwinding - which in turn set up our US Stock market for an ugly sell-off on Tuesday, one of the most dramatic declines since September 11th, 2001.
But even as the market opened on Tuesday, the Federal Reserve attempted to come to the rescue by making a surprising announcement - an emergency cut to the Fed Funds Rate and Discount Rate by .75%, in an effort to prevent a global market meltdown. The surprise announcement and magnitude of the rate cuts led to a week of exceptionally volatile trading in both Stocks and Bonds, causing home loan rates to swing wildly midweek, yet end up surprisingly close to where they had started...
Read the entire report here.
- Foster Weeks
posted by SFResidence.com @ 8:24 AM
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