Housing Soft Landing

thats too many assumptions and potentially too much massaging... i prefer raw(er) data, from the last 20-30 years max... most of the stuff prior to this is 1) unreliable, 2) mostly irrelevant for the purpose of analysis... lifestyles have changed, so have demographics, migrations etc, in a pretty big way... time & space have contracted, access to information has accelerated in a pretty big way too... welcome to the 21st century ;-)

gotta run... off to koh samui till next weds ;-) good luck with your trading
 
Quote from Son of a Gann:

Can Fed force banks to lower mortgage rate?

What is correlation between short term rate and mortgage rate?
More...

No, the Fed can't force banks to lower it (that I know of). But the FED would lower rates as a RESPONSE to the nightmare scenario that I was responding to. If the prices of housing dropped 20 to 30%, people would "feel" poor and stop spending money. The Fed would short-term lower rates to stimulate the economy.

At that point, I think long-term lenders would see less risk in lowering long term rates, and would do so in the spirit of competition.

There is a loose correlation between long term and short term rates, but there definitely is a correlation over the long term.

SM
 
Quote from Son of a Gann:

Can Fed force banks to lower mortgage rate?

What is correlation between short term rate and mortgage rate?
More...

No. Fed cannot.

Correlation between short rate and 30-yr mortgage rate is close to zero. However, there are a lot of ARM mortgages whose rates are dependent on the short rates.
 
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