Forecast for the Week

Key housing and inflation reports dominate the headlines. Plus, earnings season is in full bloom.

• Look for the closely-watched Consumer Price Index for June on Tuesday.
• In housing news, Existing Home Sales for June will also be released on Tuesday, followed by June’s New Home Sales on Thursday.
• Weekly Initial Jobless Claims will be reported, as usual, on Thursday. Claims continue to hover near the 300,000 level.
• Ending the week, Durable Goods Orders for June will be delivered Friday.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result. The chart below shows Mortgage Backed Securities (MBS), which are the type of Bond on which home loan rates are based.

When you see these Bond prices moving higher, it means home loan rates are improving—and when they are moving lower, home loan rates are getting worse.

To go one step further—a red “candle” means that MBS worsened during the day, while a green “candle” means MBS improved during the day. Depending on how dramatic the changes were on any given day, this can cause rate changes throughout the day, as well as on the rate sheets we start with each morning.

As you can see in the chart below, Bonds worsened in the beginning of last week, but improved after tensions overseas caused a flight-to-safety into the Bond markets. Home loan rates remain near some of their best levels of the year and I will continue to monitor them closely.

Chart: Fannie Mae 4.0% Mortgage Bond (Friday July 18, 2014)

The Mortgage Market Guide View…

Your Business Bookshelf
6 Leadership Classics Worth Reading (Or Re-Reading)

Here are six leadership classics worth reading (or re-reading) to help maximize your success:

How To Win Friends and Influence People. Dale Carnegie’s classic is a one-to-one communication manual that covers techniques for handling people, making people like you, winning people over to your way of thinking, and even helping them change (for the better!) without arousing resentment.

Wooden on Leadership: How to Create a Winning Organization. The legendary UCLA basketball coach John Wooden knows how to create winning organizations. In this book, he teaches you how to do the same through his Pyramid of Success, stressing the importance of preparation, and perhaps more importantly, the processes.

Delivering Happiness: A Path to Profits, Passion, and Purpose. Zappos CEO Tony Hsieh shares why creating an office culture that values happiness first can produce amazing results, not only in customer satisfaction, but also in employee motivation and loyalty—and your own happiness as a result.

The One Minute Manager. Ken Blanchard and Spencer Johnson’s book has sold over 13 million copies worldwide, and focuses on three techniques: clarifying the goals of your organization, giving praise to your team, and appropriately reprimanding when things go wrong… all in one minute each!

The Five Dysfunctions of a Team. This leadership “fable” by multiple-best-selling author and business consultant Patrick Lencioni reveals what’s at the heart of why teams fail—regardless of the dedication of key members—and the timeless method he uses to fix the problem.

Good to Great. Jim Collins offers the results of an exhaustive five-year study of all Fortune 500 companies. He identifies why only 11 of those companies achieved excellent long-term results, while the rest floundered under poor leadership—and how you can avoid making the same mistakes in your team.

As always, please feel free to pass these great reads along to your team, colleagues and clients!

Economic Calendar for the Week of July 21 – July 25

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