But we're not talking about the Chicago Bulls who were recently knocked out of the NBA playoffs. We're talking about the Bull Market that Stocks have enjoyed over the past months...that is now slipping back lower.
So why are these animal terms used to describe action in the Stock market anyways? The terms "Bull" and "Bear" are used because of the way those animals attack. Bulls attack using an upward thrusting motion with their horns, and Bears attack by moving their powerful claws in a downward motion. So an upward market is termed a Bull market, while a downward market is called a Bear market.
Tuesday, May 25, 2010
Monday, May 17, 2010
Remodeling Your Bathroom: A Project Worth Investing In
The economy is showing signs of recovery. In fact, just last week, Retail Sales were reported up for the seventh straight month - thanks in large part to the 6.9% gain at hardware stores and garden centers. If you've been thinking about spending some money of your own at a hardware store for a project around the house but aren't sure you can justify spending the money, we've got two words for you - bathroom remodel.
"IT'S A SMALL WORLD AFTER ALL..."
That sentiment was definitely felt in the financial markets last week, as the problems in Europe continue to dominate the headlines and influence market direction around the globe. So what exactly is going on...and what does all of this mean for our economy and for home loan rates? Read on for details.
Monday, May 10, 2010
"You bring me up and down!"
While Janet Jackson was singing about love and relationships, investors around the world could surely relate during last week's push and pull of wildly erratic markets. And we could be set up for an encore performance in the week ahead as anxiety persists in the European financial system.
The drama began on Monday when news of a pending bailout package for Greece sent Bonds lower, as investors pulled out of this "safe haven" and started looking toward stocks.
The very next day Stocks were back down, and Bonds were pushed up and out of their trading range, as 40,000 Greeks took to the streets to protest details of the bailout plan.
Capping off the week of volatility was Thursday afternoon's Stock Market freefall scare, during which the Dow plummeted 998 points then recouped more than 600 points - all in the span of 15 minutes.
Thursday's mysterious event, characterized as a "near-panic", may have been caused in part by a wave of electronically submitted sell orders being executed at a mind-boggling pace. Remember, a majority of trading in the markets is done by computer. With Stock prices down significantly, many computer triggers for sell orders were hit.
These triggers began executing sell orders at "market price." With the enormous flood of market sell orders coming in, bidders pulled back, so there were very few bids to satisfy the sell orders. In such situations, the computer will keep seeking out the next available bidder in an effort to fill the order...no matter how low that bid is. One extreme example was the trading of Accenture (NYSE: ACN) stock, which went from $40 down to $0.14 (yes, 14 cents), then came all the way back to close at $41.09.
The Bond market, which generally has an inverse relationship to Stocks, responded to these tug-of-war pressures and events with exaggerated ups and downs, as seen in this week's bond chart below.
This kind of tug-of-war makes the market very volatile - and underscores why it is more important than ever to work with a true mortgage professional who understands the market.
Counteracting some of the international angst last week was some positive domestic data and increasing sentiment that the US economy is improving.
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The Stock market's erratic behavior frustrated traders and investors last week.
In the end, strong domestic economic data, like Friday's better than expected official Jobs Report, was overshadowed by the drama in Europe and received less fanfare than it deserved.
According to the Labor Department, 290,000 jobs were created in April, well ahead of estimates for 187,000 new job creations. The increase was the biggest rise since March 2006. Overall, non-farm payroll employment has expanded by 573,000 since December, with the vast majority of the growth occurring during the last two months.
Despite the job growth, the Unemployment Rate ticked up from 9.7% to 9.9%.
The main reason was an increase in the labor force of 805,000. That's because unemployed individuals who do not look for a job for four weeks are removed from the labor force. When those people move back into job search mode, they are counted again - which can cause the Unemployment Rate to rise even when more jobs are being created.
OVERALL, THE ECONOMY IS SHOWING SIGNS OF A RECOVERY. BUT IT'S STILL IMPORTANT TO SAVE, SPEND, AND BUDGET WISELY.
The drama began on Monday when news of a pending bailout package for Greece sent Bonds lower, as investors pulled out of this "safe haven" and started looking toward stocks.
The very next day Stocks were back down, and Bonds were pushed up and out of their trading range, as 40,000 Greeks took to the streets to protest details of the bailout plan.
Capping off the week of volatility was Thursday afternoon's Stock Market freefall scare, during which the Dow plummeted 998 points then recouped more than 600 points - all in the span of 15 minutes.
Thursday's mysterious event, characterized as a "near-panic", may have been caused in part by a wave of electronically submitted sell orders being executed at a mind-boggling pace. Remember, a majority of trading in the markets is done by computer. With Stock prices down significantly, many computer triggers for sell orders were hit.
These triggers began executing sell orders at "market price." With the enormous flood of market sell orders coming in, bidders pulled back, so there were very few bids to satisfy the sell orders. In such situations, the computer will keep seeking out the next available bidder in an effort to fill the order...no matter how low that bid is. One extreme example was the trading of Accenture (NYSE: ACN) stock, which went from $40 down to $0.14 (yes, 14 cents), then came all the way back to close at $41.09.
The Bond market, which generally has an inverse relationship to Stocks, responded to these tug-of-war pressures and events with exaggerated ups and downs, as seen in this week's bond chart below.
This kind of tug-of-war makes the market very volatile - and underscores why it is more important than ever to work with a true mortgage professional who understands the market.
Counteracting some of the international angst last week was some positive domestic data and increasing sentiment that the US economy is improving.
-----------------------
The Stock market's erratic behavior frustrated traders and investors last week.
According to the Labor Department, 290,000 jobs were created in April, well ahead of estimates for 187,000 new job creations. The increase was the biggest rise since March 2006. Overall, non-farm payroll employment has expanded by 573,000 since December, with the vast majority of the growth occurring during the last two months.
Despite the job growth, the Unemployment Rate ticked up from 9.7% to 9.9%.
The main reason was an increase in the labor force of 805,000. That's because unemployed individuals who do not look for a job for four weeks are removed from the labor force. When those people move back into job search mode, they are counted again - which can cause the Unemployment Rate to rise even when more jobs are being created.
OVERALL, THE ECONOMY IS SHOWING SIGNS OF A RECOVERY. BUT IT'S STILL IMPORTANT TO SAVE, SPEND, AND BUDGET WISELY.
Monday, May 3, 2010
Celebrating Cinco de Mayo...and Its Connection to the United States
Celebrating Cinco de Mayo...and Its Connection to the United States
This Wednesday marks the celebration known as Cinco de Mayo, or "May 5th", in Spanish. Although many people have heard of this holiday - and even join in the celebrations with gusto - plenty of folks are not aware of what this holiday is all about. And most people don't realize that the event being commemorated may have actually played an important role in shaping the United States that we know today.
This Wednesday marks the celebration known as Cinco de Mayo, or "May 5th", in Spanish. Although many people have heard of this holiday - and even join in the celebrations with gusto - plenty of folks are not aware of what this holiday is all about. And most people don't realize that the event being commemorated may have actually played an important role in shaping the United States that we know today.
They say "the only constant is change..."
...yet last week's meeting of the Federal Open Market Committee ended without any major changes...no change to the Fed Funds Rate, and no change to the now-famous verbiage in their Policy Statement, stating that rates will remain low for an "extended period" of time. While the Fed does not control home loan rates, what does all this mean for those seeking home financing in the months ahead? Read on for details.
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