11/3/09

Good morning. Yesterday we saw Construction Spending rise .8% in September, the biggest gain in a year, the ISM Factory Index come in well above forecasts, and Pending Sales of existing homes here in the US rise over 6% in September. These “pending sales” are up almost 20% versus a year ago, which many attribute to the tax credit and “really good” prices on the low end. The FOMC meeting begins today, with the announcement tomorrow at 2:15PM EST with no change expected rates, but perhaps they tweak the language. The Fed may try to find a way of talking about what the conditions are under which interest rates would rise rather than simply pretending that there are no conditions under which rates would go up." So far this morning mortgages rates are a smidge better. We are expecting another quiet day for the bond and mortgage markets.