[Homestead] Housing bubble or froth
don.bowen at earthlink.net
Wed Nov 8 11:30:51 EST 2006
At 11/8/2006, you wrote:
>If the Fed finds that the economy is in
>danger due to real estate market conditions it will lower their
>already low interest rate to stimulate the economy. This will allow
>yet another wave of refinancing.
Home finance rates have been somewhat independent of the Fed over night
rate. One reason was the Chinese money in the market. All those Chinese
goods in Walmart helped keep mortgage rates down so people could refinance
and buy more Chinese goods in Walmart. Several factors have changed that
and one small symptom is Walmart not hitting its revenue targets and going
to even steeper discounts in Chinese goods. The Chinese people themselves
want some of the goodies, refrigerator, TV, and automotive sales have
climbed in China. This has resulted in heavy purchases of oil by China and
the run up in prices. The slowdown in Walmart sales and other markets is
reflected in slowing oil sales to China and a recent easing of
prices. Just one little loop in a very complex global market.
Don Bowen Awl Knotted Up KI6DIU
My travel journal
I am omnivagant.
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