The hoopla over Facebook Inc.’s IPO entertainment ended with a thud on Friday. Most investors advised not to jump in with both wallets as the beginning $38 a share ended at $38.23. At least it wasn’t a loss in my opinion. The DOW ended Friday at 12369.38 down 71.11 points on the news of Facebook’s dismal showing. Other contributors to the down market this week were J. P. Morgan Chase’ struggle. CEO James Dimon will be facing a grilling from finance and economic committees in Congress this coming week. The meeting of world leaders are faced with problems yet again in Greece, rising pressure from Spain’s banks and Germany’s inability to promote its own austerity agenda in the euro zone. The G8 summit made it unclear if President Obama and France’s New President, Hollande were fully aligned on economic measures needed to boost recovery in the euro zone and Greece. President Hollande did say that growth must be a priority and that he and President Obama “share the same views, the fact that Greece must stay in the euro zone”. All this in the weekend’s Wall Street Journal Report. The markets will be in for more volatility as things play out for Europe and J.P. Morgan’s ability to pull itself out of-not only its billion dollar debacle-but its public status. Mr. Dimon will have his hands full as the big bank is now the poster child for more regulations and faster implementation of the “Volcker rule”, which was designed to keep banks from investing depositor’s funds for its own profits by risk taking. Even though there is the possibility of more quantitative easing by the Fed, there is actually a little “European induced” QE happening now caused from Europe’s economic mess-keeping interest rates low.
On the brighter side, the unemployment rate fell in two-thirds of U.S. states last month, evidence that modest economic growth is boosting hiring in most areas of the country. U.S. factory output increased by 0.6% in April, helped by a gain in auto production. Busier factories have driven stronger hiring this year. Retail Sales edged up by 0.2%, after excluding gasoline station sales. The CPI (Consumer Prices Index) was unchanged in April-which is a good thing for consumers who need the extra spending cash-me included. I am sure you have seen gas prices drop an extra 6 cents per gallon this past week . The drop is expected for a little while longer before flattening out for the summer driving season.
Real Estate, Mortgage Industry, and Other Economic News
Confidence among U.S. homebuilders rose to the highest level in five years in May, a hopeful sign that modest improvement in the housing market will pick-up. Locally, I am hearing and seeing positive signs for the Real Estate market. Some Realtors I have spoken with are saying that their phones are ringing with folks really looking to buy-not just tire-kickers. I have also seen activity pick-up for more pre-qualifications from folks who are out looking to buy. The 30 year fixed rate index dropped once again, this time to 3.79 percent. Low mortgage rates is just one reason I think that the Real Estate and Mortgage markets have increased. Home inventory seems to be OK for now too. In a nutshell, homebuyers couldn’t ask for better times. The USDA has a 100 percent loan program for rural community’s. This program is designed for teachers, policemen, and first-time home borrowers, etc. The program allows the seller to pay all closings costs/escrows. There are area population requirements. There are also income and asset maximums as well. That’s right, I said maximums! Contact a local Realtor and Mortgage Lender for more details.
(This article is for informational purposes only. Do not use it as financial advice. For questions/comments contact Tony Stevenson at 1.800.460.6990 or email: firstname.lastname@example.org).