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MBA Mortgage Applications (Aug 1)

Survey n/a
Actual 2.8%
Prior -14.1%
Revised n/a

Nudging up a tad. Still looking soft. Mortgage bankers losing market share to banks. Even this low level equates historically to higher levels of sales and new starts.


MBA Purchasing Index (Aug 1)

Survey n/a
Actual 315.2
Prior 309.5
Revised n/a

Up some, muddling along. Most of the resets are past.


MBA Refinancing Index (Aug 1)

Survey n/a
Actual 1121.8
Prior 1074.4
Revised n/a


MBA ALLX 1 (Aug 1)


MBA ALLX 2 (Aug 1)

“The refinancing applications index climbed 4.4 percent to 1,121.8 last week, while the home purchase applications gauge rose 1.8 percent to 315.2 on a seasonally adjusted basis, the MBA said.”

Government spending will lift housing along with aggregate demand in general, as it always does, and there are numerous signs it’s already happening.

And history will probably see it as the Fed’s rate cuts of a year ago as it always does.

They say monetary policy ‘works’ with a lag, but seems to me the lag is always until fiscal spending kicks in.

It was the fiscal package of 2003 and not the low interest rates that got housing going the last time around.

(And history blames Greenspan for the housing ‘bubble’ rather than Bush.)

Now and then the private and foreign sector can provide the spending power by spending by ‘reducing its savings’/going into debt but that process is ultimately unsustainable without the support of government deficit spending.

The recession has again been pushed forward a quarter or two, with street firms now saying Q3 will be ok, but Q4/Q1 will be weak.

With the latest GDP revisions it’s looking more and more like Q4 2007 was the bottom, and the government deficit looking to move towards 4% of GDP should be sufficient for continued muddling through.

Demand isn’t high enough for ‘full employment’ so labor markets (whatever that actually means) should remain soft.

And more people previously not looking for work now looking for work (they now desire more income due to higher prices) will probably keep the unemployment rate elevated.


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