A Wells Fargo loan agent spoke at our Realtor's meeting this morning, and said that rates jumped three times yesterday. Drops in the bond market negatively impacted interest rates, and lenders are nervous.
But Brian Peart, owner of Nexus Financial Group, Inc and Commercial Capital Ltd, one of the 50 experts surveyed by Bankrate.com every week on the direction of mortgage rates, says the stock market has bottomed and that over the next few months the market will begin to adjust to the fact that a recession will not happen. He said that the current market is a fear-based, media fed over-reaction.
"In the overall market", Brian said, "A full recession is priced in and though numbers will come in bad, they will not come in as bad as expected. I think we will see a negative first quarter GDP but not as deep as the fears and the second quarter will be up and all recession talk will have ended. By then, the smart money will have been made. EVERYONE I talk to on main street America is doing OK. Boomers still have retirement money to put to work, we are doing a ton of refinances in Florida - not everyone is upside down on their mortgage. I talk to businesses and most of them are not feeling this huge doom and gloom that the media keeps parading. I believe the intra day low we saw of roughly 11,600 on the Dow on Monday, March 17 will prove to be the 52-week low and we will keep forging higher from there in fits and starts over the next month or two handling negative numbers like rising foreclosures but still managing to climb higher overall and at some point, probably in May, the idea will begin to grab hold that maybe we are pulling out of this. At that point stocks will probably rally strong through the Summer and into the Fall. The market will have to adjust at some point to no recession."
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