Will the economy recover in 2009? There is hope……

The week began with the change in the uptick ruling on shorting stocks which had a short lived rally in the stock market.  As the week progressed there were press announcements from Chase, Bank of America and closing out the week CitiBank.  Each re-stating their positions and viability as a sound financial institution.  CitiBank stating that they will not need the TARP funds to sustain.  Wall Street reacted positively with three consecutive days of positive gains.  These gains would normally come at the cost of Mortgage Backed Securities, on the contrary, they held strong at loosing ground in the A.M. trading session to close back in positive territories.  How this translates to the home owner, rates remained through the week between 4.875 – 5.00%.  What we really have our eyes focused on is the next three weeks and the outcome of the modification to the Mark to Market accounting rule.  This could be a huge boost to the U.S. Financial system including Banks!  With change comes uncertainty as to how mortgage rates will be impacted, but the positive side to look at is the liquidity crisis possibly coming to an end.  If banks are able to shift their balance sheets positively due to the change in the Mark to Market accounting rule they will once again to have liquidity and the ability to lend.  With lending brings the ability for business to once again revolve and restore cash flow.  As companies become stronger they will begin to slowly hire easing pressure on unemployment, in turn slowly restoring consumer confidence.  This our optimistic outlook but it much better to think about compared to where we were six months ago.  For more information please visit us at SeattleMortgageReel.com.