Abraham Lincoln gave his Thanksgiving Proclamation in 1863, and stated that the last Thursday in November would be the national day of Thanksgiving - but then in 1939, during the Great Depression, President Franklin Delano Roosevelt switched Lincoln’s chosen date of the last Thursday of November to the second-to-last Thursday of November, purely in order to extend the post-Thanksgiving, pre-Christmas shopping season! The move was met with confusion and criticism, and in 1942 FDR signed a law making Thanksgiving the fourth Thursday of November, a law which is still in effect today.

But despite all the buying and selling in the malls - the financial markets saw very little action last week, and was far from busy for Bonds and home loan rates. The absence of news and thinly staffed trading desks brought very little activity, with home loan rates unchanged for the week overall.

A NEW SCAM IS ON THE LOOSE, AS CON ARTISTS ARE “VISHING” YOU A HAPPY HOLIDAY SEASON TO YOUR FACE, WHILE THEY MAKE OFF WITH YOUR CASH. DON’T MISS LEARNING ABOUT THIS ALARMING NEW WAY THAT CRIMINALS ARE SEEKING TO STEAL FROM YOU, AND PASS IT ON TO ALL YOUR FAMILY AND FRIENDS TO PROTECT AND INFORM THEM AS WELL.

The Fed puts a lot of weight in the PCE Report because it is the best way to get a current and realistic read on inflation. The PCE measures the month to month and year to year change on a basket of goods and services that a typical consumer would purchase. The PCE is smart and makes purchases like a savvy shopper - it looks for sales and substitutions when an item in the basket gets priced too high.

Within the PCE Report is its Core Rate, which strips out items that are food or energy related, in order to get a true read on pricing power. The Fed wants inflation to come in between 1 - 2%. But the PCE has been running higher than this tolerance level…An 11 year high was set two months ago at 2.5%, with last month’s read at 2.4%. It is the job of the Fed to bring inflation back down to their comfort zone…and the way they do this is by raising rates to slow down the economy. So Thursday’s Core PCE Report will give us a look at the direction of inflation on a year over year basis. If it moves further from the Fed’s target of 2%, look for a strong possibility of another rate hike on December 12th. But a move lower in PCE, even if not down to 2% yet, should keep the Fed on ice through the rest of this year.

Prices have been relatively stable and have shown little movement for the month of November. But bond prices are near the top of their recent range, so a hotter than expected read on inflation will spell trouble for home loan rates.

You may be familiar with the term Phishing - where scammers send you emails in an attempt to acquire sensitive information like credit card details and passwords by masquerading as a trustworthy person or business.

And much like Phishing, Vishing is the latest identity-theft ploy. Beware - this one is extra tricky.

Instead of using email, scammers use voice over internet protocol (VoIP), which allows people to make calls using an Internet connection instead of a regular phone line. The con calls their target with an automated phone message, which informs them that their account has had fraudulent charges placed on it. The account owner is then lured into dialing a fake 800 number in order to resolve the charges, where a recorded voice prompts them to confirm an account or credit card number using the phone’s touch pad. This is where the problem starts, and criminals are handed free access to your account and credit cards…talk about “The Nightmare before Christmas”. So how can you be sure that you will not fall victim to this scam?

“Who do I trust? Me, that’s who!” - Some great advice from Hollywood’s most notorious criminal, Tony Montana.

Remember…creditors, government agencies, and companies you do business with already have your personal information and will not contact you to verify it.

Never respond to a cold call requesting personal information. In the same sense that you wouldn’t send your credit card information via email, don’t be so willing to punch it into a touch tone phone.

Don’t trust your caller ID. Creating a fake display name is easy with Internet-based technology, and scammers now have the ability to make it seem like they are calling from a legitimate organization.

This just goes to show that as technology improves so do the criminal’s means of taking advantage of you. Be careful this holiday season, keep track of your purchases, and help protect your friends and family by educating them about Vishing!

Economic Calendar for the Week of November 27 – December 01

The main course was a read on inflation, by way of high powered economic reports and comments from a concerned Federal Reserve Board. The Fed Meeting Minutes revealed that the Fed remains wary of the amount of inflation persisting in the economy, but more members than not are willing to be patient a little bit longer, to allow time for their string of seventeen rate hikes to fully filter through the economy. And the reports of the week did show inflation pulling back slightly more than expected, on both the producer or wholesale side, and the retail or consumer side. And lower retail inflation is good news in more ways than one, as many hit the holiday shopping season full blast this coming week.

There was also a side of news on the Housing Sector, showing it continues to cool from the overheated levels of recent years. Housing Starts of new homes fell a bit more than expected, and Building Permits, an indication of future building activity, were also reported below expectations. This cooling in the housing market could lead to a drag on the economy, which would work towards lower inflation as well.

EVEN OUR CURRENCY IS HAVING TO FATTEN UP DUE TO INFLATION…THIS WEEK’S MORTGAGE MARKET VIEW LOOKS AT THE INTRIGUING REASONS THAT THE TWO DOLLAR BILL IS MAKING A BIG COMEBACK.

With a holiday-shortened week, little news, and thinly-manned trading desks, Bond prices and home loan rates should stay fairly stable. It wouldn’t be a surprise to see Bonds get forced back beneath the tough ceiling they’ve been fighting for so long, but the move will not likely be dramatic enough to see a change in home loan rates.

The $2 bill - once stashed in souvenir drawers and birthday cards or tucked away in hopes of becoming a collector’s item - is back in action.

The $2 bill dates back to 1862, was redesigned several times, and was even discontinued in 1966 due to the bill’s low use and unpopularity. How can currency become unpopular? Retailers often mistook it for a $20 bill and gave incorrect change…not to mention the problem of where to put it in the cash register drawer! But now, the $2 bill is shedding its unpopular past and being used more and more every day - why?

Partly due to inflation - those little services or items that once cost a dollar or less have now crept over $2 due to inflation. And how about small tips, such as when you’re checking into a hotel? Not too many years ago, a patron may have tipped a bellman with $1 bills for bringing up the luggage. But with inflation on the rise, patrons today are pulling out $2 bills and handing them to the bellman for the exact same service. And the $2 bills take up less room in your wallet than the wad of $1’s often carried for tips. Additionally, the $2 bill is common in other currencies - so visitors or incoming residents from other countries are accustomed to using $2 bills, and commonly ask for $2 bills when exchanging money.

So if you decide to pull out that stash of $2 bills from the souvenir drawer and go on a spending spree, watch your change carefully, as many retailers and cashiers are still not used to exchanging money with the two-dollar denomination. And believe it or not - don’t be alarmed if the cashier refuses to accept the payment at first…a recent Taco Bell patron attempted to pay for a burrito with a two dollar bill, and the cashier and manager both refused to accept it as valid currency. When the patron insisted, the cashier and manager phoned security. The security guard actually had to inform the cashier and manager that yes indeed - two dollar bills are actually valid US currency.

Economic Calendar for the Week of November 20 – November 24

A few interesting notes from the week on housing and home loan rates…First, the old “Maestro” himself, former Fed Chairman Alan Greenspan was in the news, saying the current economic downturn was “likely temporary.” Greenspan also noted the worst of the housing market slump is likely past us. During a Q&A session at the annual Charles Schwab Impact conference in Washington DC, Big Al stated “The economy is obviously going through a significant slowing period, which as best I can tell is more than likely temporary. And while the housing market is not out of the woods yet, the current slump may not worsen.” A little cryptic in his trademark style…but if he’s right, this could point to a good buying opportunity for homes right now.

Additionally, rumors circulated about some change in direction of China’s massive holdings of foreign exchange reserves - which are mainly ours, in the form of Mortgage Bonds. Remember that their huge appetite for our Bonds has helped keep Bond prices high and home loan rates low. It sounds as if China is looking to diversify the country’s foreign-exchange reserves and is considering “various options”, such as trading in some of their hoard of US Dollar-based Bonds - again, such as Mortgage Bonds - in exchange for other foreign currencies and gold. If China is in the process of cashing in some of their Bond holdings, this could pressure Bond pricing lower in time, resulting in higher home loan rates.

JUST WHEN YOU THOUGHT IT WAS SAFE TO GET INTO A NEW CELL PHONE OR PDA…THERE’S A DANGER LURKING ABOUT THAT YOU NEED TO BE AWARE OF. YOUR PRIVATE INFORMATION COULD BE AT RISK IF YOU FAIL TO TAKE ONE SIMPLE ACTION WITH YOUR OLD CELL PHONE OR PDA. READ THIS WEEK’S MORTGAGE MARKET VIEW.

Take a look at the chart below, showing Bond prices. When Bond prices move higher, home loan rates improve. The chart clearly shows how Bonds and home loan rates have lately had a tough time beating the overhead resistance level they are currently bumping against…which means that if recent history repeats itself, Bond prices and home loan rates may be ripe to worsen. But not to say they couldn’t bash through resistance and improve…it will all depend on the flavor of the weighty economic news coming this week.

Bottom line: If this week’s reports show continued strength in the economy and further signs of inflation, Bond pricing and home loan rates are likely to worsen. To see improvement in home loan rates this week, it will take some very negative economic news or signs that inflation is waning.

Just when you thought your personal data like passwords and bank information was safe because you deleted it from your cell or PDA…turns out that hackers can still steal the information. Believe it or not, your private data can easily be hijacked from your trashed or turned in device, even when you’ve deleted everything. That could cause some major headaches for a lot of innocent people. But the good news is that you can protect yourself.

With the advancement of PDA’s and cell phones, these devices have become mini computers and contain loads of valuable and private information. Individuals store information in their cell phones like passwords, bank account numbers, appointments, contact information, even social security numbers.

And for most individuals, cell phones and PDA’s are used for about 1.5 years and then replaced, usually by upgrading to a newer model. Old cell phones and PDA’s are sold on EBay, tossed in the trash, or sent off to a cell phone recycling center. Of course, before turning it in or trashing it, most wisely delete the information.

But in reality, the information is not completely deleted…it remains on the device.

The part that is deleted is the pathway for the information to be displayed. Much like with a computer - when a file is deleted the operating system never erases the data, it only deletes the pointers to where the data is located. Hackers have the advanced software available that can resurrect erased data from a cell phone or PDA, even if you have already “deleted” the information.

In fact, the data can be recovered in 85% of cell phones and PDA’s! So hackers are buying old cell phones, extracting this valuable information, and passing it along to identity thieves.

But, there is a solution and it only requires a few additional steps to ensure that the data is permanently deleted and hacker-free.

Simply start by hitting this link www.wirelessrecycling.com, click on the “Cell Phone Data Eraser”, select the cell phone manufacturer, model, and click on the download instructions icon. Follow the instructions and all of the data will be completely and permanently removed. Can’t find the make and model? No worries - just contact the manufacturer of the cell phone or PDA, and ask for instructions on how to permanently delete all information from the device.

With just a few clicks of the mouse you can rest assured that when you sell or trash that old model, hackers and identity thieves will not be able to track where you have been, what your account numbers are, read confidential emails, or view photos or videos of your loved ones. And be sure to forward this important information on to everyone you know. Most likely they have cell phones or PDA’s and may be looking to upgrade. Knowing this valuable bit of information will keep them safe, so pass it on!

Economic Calendar for the Week of November 13 – November 17

Additionally, the Unemployment Rate fell to 4.4%, the lowest rate in over five years, and Average Hourly Earnings spiked higher than expected. Combined with news received earlier in the week on slowing productivity and increasing costs of labor…this all spells a tightening labor market. If employers have to pay higher wages to attract and retain good employees, this can lead to “wage-based inflation”, meaning that businesses eventually have to pass these costs on to the consumer in the form of higher prices for their goods and services. This hot Jobs news - laced with the scent of inflation - caused Bonds to take a nose dive on Friday, and home loan rates gave back the .125% they had gained earlier in the week.

So as controlling inflation is the primary concern of the Fed, this report brings up the question — what does the Fed make of this, and what will they do at their next meeting? Will the Fed remain patient, as they wait for the impact of their string of 17 rate hikes to completely filter through the economy? Or will Fed President Jeffrey “The Dissenter” Lacker have his day in the sun, and see the other Fed members agreeing with his inclination to hike? The next meeting is not until December 12th, so they will have a good amount of reports to chew on before then — including another Jobs Report - but the continuing whiff of inflation in the economy is not going unnoticed.

AND GET A WHIFF OF THIS…THE CREDIT BUREAUS ARE SELLING YOUR PERSONAL INFORMATION AND PROFITING FROM IT — ALL WITHOUT YOUR CONSENT! IT STINKS, BUT IT’S LEGAL…YET YOU CAN TAKE ONE SIMPLE ACTION THAT WILL PROTECT YOURSELF AND YOUR PRIVACY. READ THIS WEEK’S MORTGAGE MARKET VIEW TO LEARN WHAT TO DO NOW, AND THEN FORWARD THIS INFORMATION ON TO YOUR FRIENDS, FAMILY AND COWORKERS TOO.

The colorful chart below shows how Bonds can become “overbought” or “oversold”, and quickly reverse direction in price. Bonds have been “overbought” lately — what does this mean? Just like any other item that suddenly becomes popular and everyone’s buying it…it can quickly go too far, and fade in luster after everyone rushes to get in. Remember “Tickle-me Elmo” a few years back, with crazed parents paying hundreds of dollars for a cheap stuffed toy? Talk about an overbought item. Then the tide turned, and Elmo graced the clearance shelves in every store — merchants couldn’t do enough to get rid of them. So back to Bonds — when they’ve been overbought, prices can change dramatically in a hurry like they did on Friday…and the damage may not be done yet.

Bottom line — expect Bond prices and home loan rates to worsen slightly and then stabilize in the week ahead.

Here’s breaking news you need to know…and you need to let all your family and friends know right away as well.

Having credit checked is an important and necessary step in the home buying process, as well as something that is done on a regular basis for any number of reasons — increasing a credit line on your Visa, applying for insurance, or buying a car. But very few people realize that each time their credit is checked, the “inquiry data” that the credit bureaus (Equifax, TransUnion, Innovis or Experian) has on file has now become a commodity. This information is being sold by the credit bureaus to other lenders…and also to companies that sell and resell the same names and personal information.

That’s right — the credit bureaus have found a way to increase their revenues at your expense…and without your permission. These “inquiry leads” include name, address, phone numbers (including unlisted), credit score, current debt and debt history, property information, age, gender and estimated income. They are selling your personal, confidential information to competing creditors…and making millions. Your privacy is being sold, not just once, but over and over again.

And lenders that purchase these leads at a premium will then do everything they can to recoup their investment and turn a hefty profit. Super sneaky bait and switch tactics are being used to lure clients away from their reputable lender. Clients have even been called by disreputable lenders and told that the lender they had been speaking to previously “passed on” the information to them, because they knew that they’d be able to offer much better interest rates and terms. Ouch!

The good news is that you can make it stop, right away. And pass this information on to everyone you know — your friends, family members, neighbors and coworkers.

The consumer credit reporting industry has provided a way to “opt out” and remove your name from these lists. You can contact them by phone at 1-888-567-8688 or online at www.optoutprescreen.com. You must opt out at least 48 hours prior to having your credit checked to make sure it is processed in time. You can choose a five year or lifetime option, and the lifetime option does require a signed form. If a credit report needs to be run prior to the 48 hour waiting period — at least you are aware and informed, and can be on the lookout for suspicious phone calls or mailers from someone who has purchased your data.

BONUS: Opting out will also protect you from “pre-approved credit offers” arriving via mail…one of the leading causes of identity theft in the US.

You certainly have the right to shop for the best professional to meet your lending needs — but this should be done when and how YOU choose, not being done without your consent or permission. Looking around should be on your terms, not being done as a sneak attack, because they think you won’t know better. And unfortunately, these unsolicited marketing tactics are a nuisance and intrusive, but quite legal.

So take your privacy back. Take five minutes right now — opt out, and pass it on. Refuse to be a part of this system.

Economic Calendar for the Week of November 06 – November 10

So what’s the Fed up to? Here is the key - Tolerance vs. Patience. The Fed will not tolerate inflation above 2%…even at the expense of the economy. However, they are trying to exercise patience, as they know that it takes time for the impact of their past rate hikes to filter through the economy and fight inflation, normally between 6-9 months. So the Fed has been patient since their last hike on June 29th, waiting for inflation to decline…but inflation has been stubbornly persistent, and the patience is wearing thin on some Fed members.

The Fed’s favorite measure of inflation, the Personal Consumption Expenditure Index, hits first thing Monday, and will take special significance following this week’s action. If inflation does not begin to move lower towards the Fed’s target, expect more hikes. But this week’s tame talk on the prospects of lower inflation and slower economic growth ahead gave Bonds a boost higher, and home loan rates were unchanged to improved by .125%.

RESERVATIONS MADE AND BAGS PACKED - YOU’RE READY FOR THAT HOLIDAY VACATION. BUT HOLD ON! IF YOU ARE USING A BIRTH CERTIFICATE FOR YOUR ID OUTSIDE THE US, YOUR VACATION COULD TURN INTO A NIGHTMARE, THANKS TO A NEW LAW ABOUT TO TAKE EFFECT. DON’T MISS THIS WEEK’S MORTGAGE MARKET VIEW TO PROTECT YOUR FAMILY AND FRIENDS.

The Fed’s patience may be tested early on, as their favorite measure of inflation will hit the wires on Monday - the Personal Consumption Expenditure (PCE) Index - and it may very well influence the next Fed Funds Rate decision. Will it show inflation remaining stubbornly persistent? The Fed won’t tolerate it, and may have to hike rates at its next meeting. But if the PCE shows inflation ticking down towards the Fed’s desired target, the current cycle of hikes may finally be over. That could help improve home loan rates, and add some punch to an already hot stock market.

Speaking of a hot stock market - have you checked your portfolio value lately? You might just be pleasantly surprised…Stocks, as measured by the S&P 500 are up 13% since mid-July.

As the holiday season approaches - the vacation season approaches as well. And if you haven’t yet gotten a passport for yourself or your family members - better act now.

While a birth certificate used to do the trick for traveling out of the country, effective January 8, 2007, all US citizens leaving the country and traveling by air will be required to present a valid passport. Yep, even the kids. Why? Better security and safety. Passports are much more uniform than birth certificates, making it much easier for border and security officials to detect any forgery, and help prevent unauthorized entry into the US.

The processing of a passport can take several weeks - so even if you don’t have a trip immediately planned, get started now. Here are a few helpful links:

If you are applying for a passport for the first time, simply hit this link - First Time Passport Help - for instructions on how and where to obtain a passport, and to download the required forms to save time. When applying for the first time, you must apply in person at one of the 7,000 passport acceptance facilities.

If you need to renew a passport, the renewal can be done by mail, simply hit this link - Passport Renewal Help - to download the required forms.

As always, feel free to pass this on to your friends, family members and coworkers - they’ll thank you when they can get back into the country after their holiday vacation…

Economic Calendar for the Week of October 30 – November 03

The economic reports of last week were mixed, but underscored a continuous message - that the US economy is still cooking along with some strength, and certainly exceeding most analysts’ expectations. And most all the recent reports cover the bases in bearing this out - housing numbers remain better than expected, employment is still reasonably strong, the stock market is roaring away…and as a result, inflation continues to be hotter than anticipated.

Bonds and home loan rates were fairly stable this week - but are very sensitive to the fact that inflation is remaining stubbornly present in the economy. This is why Bond pricing and home loan rates have worsened slightly in recent days.

While there are no clear-cut signals - the stream of upbeat reports indicate that the economy has not slowed down as much as the Fed had expected, meaning that the Fed actually might have to consider increasing rates a little bit more to combat the inflation that still remains in the economy. Read on to learn what’s on deck for the coming week, and how it might impact home loan rates ahead…

THE SCORES ARE IN…AND THEY ARE STARTLING. DON’T MISS THIS WEEK’S MORTGAGE MARKET VIEW ON THE MOST RECENT TAX STATS, SHOWING WHO’S ON FIRST AND PAYING SOME BIG LEAGUE TAX DOLLARS RELATIVE TO INCOME.

The action in Bond pricing and home loan rates may be lively this week when the Fed makes their announcement on Wednesday. If the Fed decides to remain in a paused mode - the Bond market and home loan rates may move in a positive manner if the accompanying Policy Statement indicates that the Fed does indeed feel inflation is controlled. However, if the statement does hint at concerns of inflation and the real possibility of rate hikes ahead - Bonds and home loan rates will likely worsen, with confirmation that inflation is indeed not on the way out quite yet.

By the same token, a rate hike would be a surprise after two consecutive decisions to pause…and while normally a move to control inflation helps Bonds and home loan rates to improve, a surprise hike might just confirm those inflationary fears, and cause Bond pricing and home loan rates to worsen.

At this point - it’s anyone’s ball game…but depending on the Fed’s decision, the action for home loan rates may be intense.

The IRS just completed their analysis of 2004 tax returns, the most recent available - and the findings are very interesting, recently reported in the Kiplinger Tax Letter dated October 6, 2006. Relatively speaking, people that earn high incomes are shouldering a very large percentage of the overall taxes paid - in fact, the latest numbers show they are bearing the second highest burden since the 1986 Tax Reform Act passed.

Here are the “taxing” stats, which also make some interesting talking points…where do YOU fit in?

• The top 1% of filers paid 36.9% of all income taxes, up from 34.3% the year before, but represented just 19% of total Adjusted Gross Income (AGI). An AGI of at least $328,000 was needed to be classified in the top 1%.
• The top 5% of tax filers paid 57% of total income tax received by the IRS, and made 33% of total AGI. These filers all had incomes of $137,000 or more.
• And the top 10% of all filers - those with AGI’s of at least $99,100 - bore 68% of the income tax burden, but only represented about 44% of total Adjusted Gross Income.
• The bottom 50% of filers paid just 3.3% of total income tax, down from 3.5% the prior year. This was the lowest figure in recent years.
• The lowest-income earners actually had a NEGATIVE income tax rate, due to the Earned Income Credit refunding income and payroll taxes.

Economic Calendar for the Week of October 23 � October 27

And although the “cover of the book” after the last Fed meeting gave the indication that inflation was under control, as the official word following the meeting was that the Fed again elected to pause in the rate hike cycle…the inside story spun a bit of a different tale. Last Wednesday, the “Meeting Minutes” from the last Federal Open Market Committee policy-setting meeting were released, giving the details of the dialogue amongst the attending members, including those who did not vote in the last meeting. As it turns out, the comments reeked of continued concerns about inflation in the economy. And because inflation erodes the value of a fixed-return Bond, it’s bad news for Bonds - and therefore home loan rates, which are based on Bonds. On all this news, home loan rates were unchanged to slightly worse, about .125% higher over the course of the week.

DOES ALL THIS TALK OF HIGHER INFLATION MAKE YOU FEEL A LITTLE ILL? YOU MAY WANT TO REACH FOR THE PEPTO BEFORE VISITING YOUR DOCTOR, BECAUSE HEALTHCARE COSTS HAVE INFLATED THREE TIMES FASTER THAN EVERYTHING ELSE IN OUR WORLD. READ THIS WEEK’S MORTGAGE MARKET VIEW TO LEARN WHAT SOME ARE DOING TO SAVE MONEY ON THE EVER-INFLATING COSTS OF MEDICAL CARE.

Additionally, the Minutes also revealed that the Fed sees continued US economic strength going into 2007, and they are uncertain whether the recent drop in energy prices can be counted on to remain in place much longer. Remember - good news for the economy is good news for Stocks…but because Stocks and Bonds are often competing for the same investment dollar, good economic news can be bad news for Bonds, and therefore home loan rates too.

You can bet that with all this renewed talk on inflation, the Fed will be closely watching this coming week’s Producer Price Index (PPI) and Consumer Price Index (CPI), which measure inflation on both the wholesale and consumer levels. If the news bears out continued economic strength and whiffs of inflation - home loan rates will worsen on the headlines.

Many Americans aren’t feeling very famous when it comes to the quality of healthcare service - and along with the lack of service has come the ever-escalating costs. According to the National Coalition on Health Care, medical expenses are increasing at three times the rate of inflation! So here comes the latest trend…the “outsourcing” of healthcare.

Many Americans are fed up with the high cost of healthcare in the United States, and are actually outsourcing their medical needs to other countries, such as Costa Rica, India, Thailand and Mexico. In fact, some US healthcare plans even cover approved providers in Mexico. Sound crazy? Maybe…maybe not.

Say a doctor in California performs a medical checkup and diagnoses that a patient is in need of bypass surgery within the next few months. After shopping around, the patient finds that the average price for the surgery in California is $60,000. But if the patient’s health permits and the patient is able to fly to India, that same surgery will run about $6,500. Even with the added travel expenses, the price is still substantially lower. And it may be possible that the travel expenses could qualify for a tax deduction. There are many examples of these types of savings, especially when it comes to elective surgeries.

If you are considering catching a flight to another country to take advantage of the money you can save on healthcare, remember - safety first. Be sure to ask for a referral of an overseas doctor from a physician, family member, or friend. And check with your current medical insurance provider to see if any of these expenses may be part of your existing coverage. When it comes to tax deductions, be sure to seek the advice of a tax professional to confirm that medical deductions apply to your own personal tax situation. If you do not have a great tax professional, please feel free to contact me and I would be happy to recommend one.

Economic Calendar for the Week of October 16 – October 20

The headline number of new jobs created in the US economy for September was reported at 51,000 - a miss from official expectations of 120,000, but very near where the market at large was anticipating. But then came the real “goof” - the previous month’s number of jobs created was revised upward by 60,000 jobs! That’s quite a big miss, adding more jobs by revision than September was reporting in total. Normally a weak jobs number would cause Bond prices to worsen and home loan rates to improve, but the surprise upward revision caught the market off guard. Home loan rates inched very slightly higher on Friday, yet overall ended the week very close to where they began.

A further surprise came in the form of a downward tick in the unemployment rate, moving from 4.7% last month now to 4.6%, indicating that the US still has a healthy job market on the whole. And although the housing market has cooled as expected - strong job markets lead to healthy housing markets.

ONE THING YOU MAY NOT WANT TO MISS IS THE YEAR-END DEALS YOU CAN GET ON NEW VEHICLES, AS DEALERS CLEAN OUT THE OLD INVENTORY AND MAKE WAY FOR NEW. BUT IF YOU DO WANT TO MISS SOME OF THE RUNAROUND OFTEN ENCOUNTERED DURING THE BUYING PROCESS, READ THIS WEEK’S MORTGAGE MARKET VIEW.

A look at the chart below shows Bond prices remain on a clear uptrend, meaning home loan rates have improved over the recent months. Could rates continue to get better, or are they ripe for a reversal? The present technical support just underfoot Bond prices has helped them hold their improvements - but news that stinks of inflation could cause them to step off the Up Escalator, with home loan rates worsening. But if the floor of support can hold throughout the news of the week ahead - home loan rates should continue to improve overall. In observance of the Columbus Day holiday, the markets will be closed on Monday, reopening for action bright and early on Tuesday.

Before you even start negotiating the price of the car, ask the salesperson if the dealership requires that you sign either a “Dispute Agreement” or “Conflict Resolution” agreement. Sounds innocent enough, but here’s the deal. By signing the form you are agreeing that if a problem arises, the problem will be settled through arbitration…where the auto dealer chooses the arbiter, you pay all the fees, prohibits you from appealing the decision - but the dealership can appeal, and it also excludes you from participating in any class action lawsuits against the dealer. Whoa. So if the salesperson says that this form is a requirement, think twice - as dealerships that require these forms may possibly not be reputable ones, and may potentially face frequent lawsuits.

When reviewing the pricing and list of fees associated with the purchase, be on the lookout for “environmental fees” or “advertising fees”. These costs are often just a way for the dealer to make a few extra bucks at your expense, so be aware of that when negotiating price. Additionally, “protection packages” are generally not worth the cost. If you are super concerned about protecting the interior or exterior of your car from weather or sticky fingers - you are generally much better off getting that done on your own.

When you arrive at the financing table, take your time signing. Most people want to get it over with quick and race away, testing out the zero to sixty MPH performance, leaving a few skid marks in their wake…but those skids could be super costly if you speed too quickly through the financing process.

Review all the documentation with care - and ask in particular if your financing is approved prior to taking delivery on the vehicle. If you have signed a “Writ of Rescission” as part of your financing paperwork and take delivery on the car without your financing approved - you have just agreed to take a higher financing rate and higher payments, if you are not approved under the terms you were quoted. One way to avoid this situation altogether would be to obtain financing through a credit union or bank prior to going to the dealership. You may end up with a better rate, and not have to worry about unethical financing practices.

For more tips and details about the process of buying a car, visit www.autoissues.org, or purchase and read “Don’t Get Taken Every Time: The Ultimate Guide to Buying or Leasing a Car in the Showroom or on the Internet” by Remar “Bubba” Sutton. Doing your homework will save you time and money - and best of all, will have you driving off the lot knowing that you got the best deal possible for your new car!

Economic Calendar for the Week of October 09 – October 13

New and Existing Home Sales arrived with a conflicting read - Existing Sales a bit worse than expected, New Sales a bit better than expected - overall showing a moderate cooling in the housing sector, but no “bubble bursting”. Prices appear to have flattened over the past 12 months, with some areas showing very modest increases and others showing very slight price declines.

Durable Goods Orders - Bigger ticket items that last longer than three years - came in very weak, suggesting purchases are slowing down due to the higher cost of financing. But then the Purchasing Manager’s Index - which rates the health of the Manufacturing sector, which makes these products - was surprisingly strong. Personal Income and Spending came in lower than expected - but Consumer Confidence and Sentiment readings were very positive. What a mix indeed…Bond prices and home loan rates bobbed around midweek on the news, but ended up almost exactly where they began.

And that wasn’t all - let’s look at the inflation front, since it is the key driver of home loan rates…as well as being the largest determining factor on whether the Fed will decide to keep the Fed Funds Rate in a paused position, continue to hike, or revert to cuts in the near future.

The Federal Reserve’s favorite measure of inflation is Personal Consumption Expenditure (PCE) Price Index, which came in showing inflation still remains higher than expected, and outside the range of what the Fed wants to see. The Fed wants inflation to be 1% to 2%, on a year over year basis. And the PCE, which is the Feds most important measurement of Inflation, showed a reading of 2.5%. That’s a little higher than what the Fed wants, but showing signs of moving lower. Why is the PCE so important to the Fed…and to us as well? Here’s the inside scoop - take this little detail to the water cooler, and impress your friends and coworkers!

PCE differs from the more widely watched CPI (Consumer Price Index) in a few important ways. CPI measures the change of the cost for a “fixed basket” of goods and services, and assumes that consumers will keep buying the exact same thing, regardless of price change, and assumes the consumer has endless resources to do so. PCE is far more accurate, because it is more realistic as to how the average shopper makes purchases. If the price of honeydew melons goes through the roof, a shopper will more than likely make substitutions, like cantaloupe…or even skip buying that item altogether, if this price has gone out of range. So let’s continue to watch PCE in the months ahead to see if the Fed may be in a position to actually lower rates early next year.

REGARDLESS OF WHAT THE FED DOES AND HOW IT IMPACTS OUR FINANCES…WE ALWAYS WANT TO SAVE MONEY ON OUR PURCHASES. AND SINCE WE’RE STILL AHEAD OF THE CRAZY HOLIDAY SHOPPING SEASON, TAKE A MINUTE TO CHECK OUT THIS WEEK’S MORTGAGE MARKET VIEW FOR SOME UNBELIEVABLE SECRET SAVINGS YOU’LL BE GLAD YOU FOUND OUT ABOUT.

The chart below shows how Bond prices have been in a clear uptrend, meaning home loan rates have been in a clear downtrend…and stand at their best levels in six months. So what would need to happen to see more improvement in home loan rates? Bond prices and home loan rates tend to benefit from weak economic news, as traders and investors move money out of the Stock market, and into the stable safety of the Bond market. On the other hand, strongly positive economic news causes money to move into Stocks, and away from Bonds, which may not provide the exciting gains that the Stock market can offer in a vibrant economy.

Bottom line: Weak economic news will help home loan rates improve, and strong economic news will generally cause home loan rates to worsen. Since the economic scene is a bit mixed at present with both some weak and strong indicators…the news this week will be very important, and likely provide the direction and tone for home loan rates for the near term.

If that phrase doesn’t excite you - you are like millions of Americans who enjoy the convenience of shopping online. Doing your buying online is a great way to shop for anything from gadgets or the latest fashions to a quick gift for a friend…or maybe you plan to do all your holiday shopping online this year to avoid the crowds! Yet many “shop-a-holics” claim that by spending all the time scouring the stores, they are sure to get the best deals. But what if you could buy online, knowing that you got a good deal on the item…without having to invest hours of your valuable time pounding the streets, or surfing all over the internet to ensure the lowest price?

Well, wish no more.

Check out www.secretprices.com, loaded with special coupons and discounts for many popular online stores, such as Amazon, Brookstone and Sharper Image. Ever buy at Office Depot, Gap or Circuit City? The website is loaded with savings for all these companies - most of which are discounts on any purchase you make, not just for one particular item they are trying to get rid of. It’s like having a personal “cyber shopper” that goes out and does the bargain shopping for you - it saves you time and money too.

Log onto the site, and click the link for “Coupon Center”. If you see a particular vendor you are looking for, just click the business name, and you’ll be led to a special page of their discounts. If you want to view them all - hit the link for “Latest Coupon Codes” to see a list of all the savings. You may also want to hit “Expiring Coupon Codes” to see if there are any discounts expiring soon that you’d like to take advantage of.

And don’t miss hitting the link for “Latest Deals”. Here you will find a wide range of special deals being offered on a wide range of products - printers for 50% off, cordless phones for 75% off…it’s worth a few minutes to prowl around and see what you might be interested in! “Expiring Deals” have some hot specials too - again, worth a few minutes of browsing.

You can shop by category, with everything from books to jewelry to event tickets to clothing. Just pick the category and you can select the product from a variety of stores, compare the prices, read customer reviews, and then save even more with secret coupons and deals. And, best of all….it is safe, secure, and advertisement free. While on the site you will not be bothered by annoying pop-ups, flashing advertisement banners, or spyware.

So you don’t have to shop ’til you drop - saving online is now easier than ever. And let’s face it, it feels good to save money on your purchases, and saving a few bucks here and there adds up. Getting a good deal will not only save you money in the long run - but will make you feel better about purchasing the product in the first place. Know anyone else who shops? Of course you do - so feel free to pass on this article, and help them save money too!

Economic Calendar for the Week of October 02 – October 06

First the Producer Price Index - which shows if costs are increasing for those producing the goods we buy - came in showing costs had not increased last month, but actually decreased! Quite a surprise, although some of the decline was due to lower oil prices…but still good news, as producers have fewer reason to pass on higher costs to us consumers. Next, the Fed for the second straight meeting, opted to stay in a “paused” position, and commented that while economic growth is moderating, some inflation risks remain. Fine - no real surprises there, as the Fed tends to not want to shock or upset the market via their prepared commentary. But then along came Friday’s somewhat dramatic Philly Fed manufacturing report, showing a very major slowdown in the manufacturing sector. Many economists are wondering, “Did the steam leave the economy?” The cool financial news of the week helped Bond prices improve, and brought about .125% of improvement to home loan rates.

And now while a nice orderly slowdown that feels like a cool breeze is what the Fed desired with their string of seventeen rate hikes, concerns are now mounting about the severity of the slowdown. The Fed has had a history of always going too far, not being patient enough and sending the economy into recession. It will be interesting to see how things play out going forward, and next weeks reports will be especially important…read on.

“GEZHUNDHEIT”…”BLESS YOU”…”HEY, COVER YOUR MOUTH WHEN YOU SNEEZE!” WE’RE GETTING READY TO HEAR IT ALL OVER AGAIN, AS WE HEAD INTO COLD AND FLU SEASON. WOULD YOU LIKE A FEW LESS OF THOSE COMMENTS DIRECTED YOUR WAY? DON’T MISS THIS WEEK’S MORTGAGE MARKET VIEW - WITH SOME SURPRISING TIPS ON STAYING HEALTHY THIS SEASON.

One important report of note is the Personal Consumption Expenditure (PCE) Price Index…and while it sounds like a big mouthful of something boring, it’s a look at the prices we are all paying each and every day as consumers - pretty important stuff, which impacts every one of us. And unlike the Consumer Price Index (CPI), which measures a “fixed basket” of goods and services, the PCE takes into consideration the actual purchases being made by all of us, including changes in our buying trends and patterns. This is the Fed’s very favorite read on inflation…so better believe Friday’s release of this number will make some news, as everyone including armchair economists rate the Fed on their course of action.

The chart below looks pretty good, showing clearly how Bond prices have climbed higher over the past few months, meaning home loan rates have in turn been moving lower. Could rates continue to improve further? It’s sure possible…and the action for rates this week will all depend on the flavor of the news.

Good rule of thumb to keep in mind - if the reports and numbers come out hot and strong, super positive for the economy, or have a scent of inflation…this will be bad news for Bond pricing and home loan rates. Numbers that show a cooling economy or contained inflation will be good news for Bonds and home loan rates.

Listen in to the news this week, and be your own armchair economist - then read next week’s issue to see how you did!

A few quick tips - some you may know, but a few might be surprises:

First, determine how susceptible you are by asking yourself a few questions. Were you ill several times last year? Do you frequently feel fatigued? Do you sleep less than seven hours per night? If you answer yes to several of the questions, it may be a good idea to consult your doctor for a pre-flu season check-up.

Build up your immune system by taking the time now to catch up on sleep and get a flu shot. Ever heard the old adage to “starve a fever and feed a cold”? While you don’t need to go as far as actually starving, the idea is if you’re hot from a fever, you need to put less fuel into your body to cool it down, and if you’re cold from the chills, you need to eat to fuel your body and warm it up. Modern medicine may argue that adding a few supplements of medicine and continuing to eat would be the best alternative.

For the common cold, take a high dose combo of Vitamin C and Zinc. Taking these supplements has shown that these remedies can markedly reduce cold symptoms. For the flu, ask your doctor for a prescription of an antiviral drug. This could help shorten the duration of the flu and will have you back on your feet in no time. For preventative measures - try a product like Airborne, to help keep your immune system strong.

Here’s a tip that’s actually pretty enjoyable. Everybody loves a nice steam - but did you know it can help keep you well? That’s right, sitting in a hot steam room can actually kill many germs that could make you sick. Experts say that those who enjoy a weekly steam reduce their chances of getting sick very dramatically. Some steam many times a day to break off cold symptoms.

Wash your hands frequently, and carry a hand sanitizer such as Purell with you to keep your hands germ free. Hand to mouth is the most common way that people get sick, so keep those hands clean, and encourage your family to do the same.

And here’s a little known, interesting, yet highly effective idea…did you know you can literally “wash that cold right out of your nose”? Although it doesn’t look pretty in action, a simple saline nasal wash or nasal irrigation can rid you of colds and allergies, by washing out the germs - and also healing and protecting your nasal passages. When dry winter air makes the tissues inside your sinuses dry and cracked, germs have a perfect place to live and breed - making you sick more easily. But a saline nasal wash, available at most drugstores, can lubricate, protect and clean those nasal tissues - and keep you well and healthy. And it may actually help reduce snoring!

At the end of the day - what’s more important than your health? By taking a little time to protect yourself from illness, you ensure that you can continue to do all the other things in life that are important to you - spending time with family and friends, working hard at your career, and enjoying time living in a healthy body!

Economic Calendar for the Week of September 25 – September 29