30-Year Fixed Mortgage Rate Falls to 5.76%

30-year fixed mortgage rate (left) vs. 3-month T-bill (right) over 4 years.

Source: Bankrate.com

Turkeys Away: WKRP Classic

Case-Shiller U.S. Home Price Indices

The chart above depicts the annual returns of the U.S. National, the 10-City Composite and the 20-City

Composite Home Price Indices. The decline in the S&P/Case-Shiller U.S. National Home Price Index –

which covers all nine U.S. census divisions – remained in double digits, posting a record 16.6% decline

in the third quarter of 2008 versus the third quarter of 2007. This has increased from the annual declines

of 15.1% and 14.0%, reported for the 2nd and 1st quarters of the year, respectively. The 10-City and 20-

City Composites continue to set new records, with annual declines of 18.6% and 17.4%, respectively.

“The turmoil in the financial markets is placing further downward pressure on a housing market already

weakened by its own fundamentals.” says David M. Blitzer, Chairman of the Index Committee at 

Standard & Poor’s. “All three aggregate indices and 13 of the 20 metro areas are reporting new recordrates

of decline. Looking at the returns of the U.S. National Index, prices are back to where they were in early 2004. 

As of September 2008, the 10-City Composite is down 23.4% from its peak, the 20-City Composite is down 

21.8% and the National Composite is down 21.0%.”

Phoenix was the weakest market, reporting an annual decline of 31.9%, followed by Las Vegas, down

31.3%, and San Francisco at -29.5%. Miami, Los Angeles, and San Diego did not fair much better with

annual declines of 28.4%, 27.6% and 26.3%, respectively.

Dallas and Charlotte faired the best in September in terms of relative year-over-year returns. While also

in negative territory, their declines remained in single digits of -2.7% and -3.5%, respectively. However,

both are at rates of decline lower than those reported in August’s numbers. In addition, Charlotte also

reported its largest monthly decline on record, down 1.3%. Monthly returns were negative across the

board. Cleveland was the one market that showed any improvement in its year-over-year returns

reporting -6.4% compared to the -6.6% reported for August.

The table below summarizes the results for September 2008.

 

The S&P/Case-Shiller Home Price Indices are published on the last Tuesday of each month at 9:00 am

ET. They are constructed to accurately track the price path of typical single-family homes located in each

metropolitan area provided. Each index combines matched price pairs for thousands of individual houses

from the available universe of arms-length sales data. The S&P/Case-Shiller National U.S. Home Price

Index tracks the value of single-family housing within the United States. The index is a composite of

single-family home price indices for the nine U.S. Census divisions and is calculated quarterly. The

S&P/Case-Shiller Composite of 10 Home Price Index is a value-weighted average of the 10 original

metro area indices. The S&P/Case-Shiller Composite of 20 Home Price Index is a value-weighted

average of the 20 metro area indices. The indices have a base value of 100 in January 2000; thus, 

forexample, a current index value of 150 translates to a 50% appreciation rate since January 2000 for a

typical home located within the subject market.

Source: S&P and Fiserv

Automakers Rev Up PR Campaign for Bailout

The Big 3 made their case for a federal bridge loan to the Senate yesterday, and hope to get a warmer reception from the House today.  In an effort to boost their chance of success, a full-court press is underway in the court of public opinion.

Onion: Should the Government Stop Dumping Money into a Giant Hole?

Spoof News: Harvard Will Shut Business School Doors

By JOHN LEVERETT 

Published: July 4th, 2009

Harvard University Business School will be closing its doors following an unprecedented drop-off in applications this fall. The school will be renamed the Harvard University School of Integrity, and students will receive Masters in Integrity and Compassion, or M.I.C.s.

“We believe that the recent increase in visibility of progressive movements and ideals, coupled with the demotion of free-market capitalism as a viable belief system, has led students away from training in accumulation for its own sake and into fields where they can advance peace and justice,” said Harvard spokesperson Susan Morrison.

It became apparent in early 2009 that enrollment in fields like marketing, advertising, corporate communications, and management dropped 44 percent, while enrollments in fields like social work, journalism, and community organizing were up 53 percent in the same period.
“We’re not sure if it’s an anomaly or an indicator of a long term trend, but there’s definitely a change,” said Morrison.

Morrison said the new Integrity School is contacting campuses around the world to encourage graduating seniors to apply. “We see as our job to help students tap into their desire for integrity and compassion, rather than their greed. That’s what they need, and that’s what our society needs.”

Source: Fake NY Times

Keeping an Eye on the Russian Economy

The RTS index of Russian stocks is down 22% in two days as oil in free fall pressures the rouble and strains the government's foreign currency reserves.  The situation is eerily reminiscent of 1998 when falling oil prices contributed to a financial meltdown and the re-valuation of the rouble.  The Russian people only recently began to trust banks again, thanks to oil-driven boom times and the adoption of consumer credit.  Another collapse on the scale of 1998 could have devastating repercussions to the teen-aged Russian experiment in capitalism.

Oil:

5-Year Rouble/Dollar:

U.S. Unemployment Rate Since 1998

I can't explain my renewed interest in Excel, it's like I'm back in college, just roll with it.

Natural Gas Weekly Storage 5-Year Chart

At 3,405 Bcf on Oct. 31, stocks were 130 Bcf below 2007 levels, and 78 Bcf above the 5-year avg. of 3,327 Bcf.  

How about another request for more 2X levered ETFs?

Nat gas would be hugely popular.

UNG 1-year chart:

China gets fiscal: $586 billion stimulus

Concerned that economic growth could slow to a rate below 9% (the horror), China's plan dwarfs the initial $168 billion U.S. stimulus package of tax rebates.
The FXI was up 12.8% on Friday, which is set up to mimic just a direct 1:1 relationship with the FTSE/Xinhua China 25 Index. The FXP, the double inverse of the FXI, was down 25.6% (spot on management). One would expect the FXI to gap higher on Monday. Too bad there's not a 2X long China ETF, or emerging markets. You could short the FXP or EEV.  UYM, 2X basic materials, could work.  But opening gaps often fade throughout the trading day.