Jason Bernabei, TriCastle Realty
DEL MAR, April 30 2012 --Goooooooodddd Monday morning not-so Sun Diego! It’s not a very beautiful day for baseball, and the Padres sure have gone south in a hurry. But the economy has held up over the past few quarters and the Federal Open Market Committee has taken note.
DEL MAR, April 30 2012 --Goooooooodddd Monday morning not-so Sun Diego! It’s not a very beautiful day for baseball, and the Padres sure have gone south in a hurry. But the economy has held up over the past few quarters and the Federal Open Market Committee has taken note.
The
Federal Open Market Committee, or FOMC for short, voted last Wednesday to leave
the Fed Funds Rate unchanged within its current target range of 0.000-0.250
percent. And for the fifth consecutive month, the Fed Funds Rate vote was all
but unanimous. Only one FOMC member, Richmond Federal Reserve President Jeffrey
Lacker, was in dissent, thus resulting in a 9-1 vote. The Fed Funds Rate has
been hovering around zero percent since December of 2008. It is expected by
most experts to remain close to zero through 2014, though there is some
skepticism from opponents.
In
defense of the move, the Federal Reserve issued a press release stating that
the U.S. economy has been "expanding moderately" since the FOMC's
last meeting in March. Beyond the next few quarters, the Fed expects growth to
"pick up gradually." These statements coming after some key data recently
made available suggested some not so smooth sailing for Housing recently on the
national scene, as I discussed last Monday. The overall, current U.S. economic trend
has been positive and the core competency of the FOMC’s justification for its
positions relies on this positive trending as a forecast for further positive
strides, despite hic-cups in certain areas like Housing.
Playing
the role of its own devil’s advocate to some extent, the Fed acknowledged that
"strains in global financial markets" continue to pose
"significant downside risks" to the long-term U.S. economic outlook.
This is in reference to the sovereign debt concerns of Greece, Spain and Italy
that I’ve discussed in detail in past blogs, and the potential for a broader
European economic slowdown over time.
The Fed
re-affirmed its intent to hold the Fed Funds Rate at "exceptionally
low" levels through late-2014, and to buy mortgage-backed bonds in the
open market. What followed the FOMC's statement was the almost immediate improvement of mortgage markets, pushing mortgage rates EVEN LOWER nationwide. And THAT is great news for prospective homebuyers in San Diego RIGHT NOW!
So until next time San Diego, you can contact me, Jason Bernabei, at jasonb@tricastle.com, and check me out each and every Monday on www.therealtyinsiders.com for more, and be sure to tune in to see myself, and local industry experts talking real estate on "The Realty Insiders," the ONLY real estate show in town!
So until next time San Diego, you can contact me, Jason Bernabei, at jasonb@tricastle.com, and check me out each and every Monday on www.therealtyinsiders.com for more, and be sure to tune in to see myself, and local industry experts talking real estate on "The Realty Insiders," the ONLY real estate show in town!
Jay's Outlook: mostly sunny
Jason Bernabei, TriCastle Realty