"IT AIN'T OVER TIL IT'S OVER." Yogi Berra.

And whether you find those words deeply wise or simply puzzling...The Fed has told us repeatedly that their massive purchasing program of Mortgage Backed Securities is just about over - and this translates to home loan rates rising in the near future. As you can see in the chart below, the amounts of Mortgage Backed Securities the Fed is purchasing are slowly dwindling, as the program is set to wrap up by March 31st, and are clearly trying to ration out the remaining portion. Last week, the Fed purchased $11 Billion in Mortgage Backed Securities, which leaves them with $66 Billion to spend out of their original $1.25 Trillion allotment. So about 95% of the total has already been spent and has purchased about 3 out of every 4 home loans during the past year. When such a large buyer leaves the market, it is very likely that prices will worsen.

HOMEBUYER TAX CREDIT DEADLINE QUICKLY APPROACHING

With only three months until the new $8,000 first-time homebuyer and the $6,500 existing home buyer federal tax credits are set to expire, time is running out on an opportunity that buyers and sellers may not see again. The tax credit, which was originally created in mid 2008, then expanded in January 2009 and extended again this past November, was only designed to be a short-term incentive to drive more buyers into the housing market.That’s why many people in Congress are saying that, come April 30, 2010 when the credit expires, “That is it!”

"BOTH OPTIMISTS AND PESSIMISTS CONTRIBUTE TO OUR SOCIETY. THE OPTIMIST INVENTS THE AIRPLANE, AND THE PESSIMIST - THE PARACHUTE." G.B. Stern

And last week's Jobs Report had something for both optimists and pessimists, as the numbers were both good and bad...depending on which survey you looked at, and what numbers you focused on.

First, the headline numbers: The Labor Department reported that there were 20,000 jobs lost in January, which was worse than expectations of 15,000 jobs gained. However, the Unemployment Rate came in lower at 9.7%, down from last month's read of 10.0%. But what do these numbers actually tell us?

"THE NINE MOST TERRIFYING WORDS IN THE ENGLISH LANGUAGE ARE: `I'M FROM THE GOVERNMENT, AND I'M HERE TO HELP.`" Ronald Reagan.

And regardless of if those words do indeed terrify you or perhaps give you confidence, the government held center stage last week, with a pivotal Federal Reserve Board Policy Statement, President Obama's first State of the Union address, and Ben Bernanke's confirmation for another term as Fed Chairman.

First, let's start with the Federal Reserve Board, who on the heels of their most recent meeting reiterated their important line, "rates will remain low for an extended period" in their Policy Statement. This tells us that the "carry trade" which has pushed Stocks, Commodities and even Bonds higher may continue, as the driving force of this trade - low interest rates - will likely provide a tailwind. This piece of the Statement was good news for Bonds and home loan rates. However, this was offset by further confirmation that the Fed's Mortgage Backed Security purchase program will indeed end March 31st, 2010. This was bad news for Bonds and home loan rates, and overrode the "extended period" statement in terms of Bond market and home loan rate action.

Then on Wednesday evening, President Obama delivered his first official State of the Union address, and just like in his initial post-election speech, a big theme was job creation.

"If you are losing a tug-of-war with a tiger, give him the rope before he gets to your arm. You can always buy a new rope." Max Gunther.

Such a sweet sentiment...but definitely not one that the markets adopted this week, as both Stocks and Bonds battled back and forth near key technical levels.

The markets were closed on Monday in honor of the Martin Luther King, Jr. holiday, but then the Bulls and the Bears in the Bond market spent the first part of the week pushing and pulling Bond prices above and below their 200-Day Moving Average. This level is important because it can often set the stage for price direction for an extended period of time. Bonds were finally able to break above this important level, which was good news for home loan rates.

"THERE ARE NO SECRETS IN LIFE, JUST HIDDEN TRUTHS THAT LIE BENEATH THE SURFACE." From the Showtime TV hit, "Dexter".

The highly anticipated Jobs Report arrived last Friday morning, showing 85,000 jobs lost during December...and while this was a bit worse than expected, the report also carried some good news, in that the prior month's revisions showed that November actually had a final tabulation of job gains for the month, for the first time since December 2007. Additionally, the Unemployment Rate remained stable at 10%. While this all seems to indicate some level of improvement in the labor market - you do have to look beneath the surface to clearly understand the present realities for the labor market.

"We will open the book. Its pages are blank. We are going to put words on them ourselves.

The book is called Opportunity and its first chapter is New Year's Day." Edith Lovejoy Pierce. And as we begin a New Year, fresh with opportunity - here's what you need to know about the last week of 2009.

The holiday shortened week had some fireworks, and not just those ringing in the New Year. The Treasury Department auctioned a whopping $118 Billion in T-Notes last week, and the added supply helped bring on some volatility in Bonds. And although the financial markets in general have been quite volatile of late anyways, the potential for increased volatility is typically greater during a holiday week. This is because trading volume levels decrease, and with fewer traders and investors pushing transactions, it opens the door for exacerbated market moves, as one large trade can cause prices to rise or fall more sharply.