Forecast For The Week
This week’s economic calendar is light, but there are still some important reports to watch:
In addition to those reports, the markets may be impacted by the upcoming holiday weekend. That’s because the week leading up to Memorial Day weekend usually sees low trading volumes – and by Friday afternoon, trading desks have pretty much cleared out. When volumes are low, markets can easily see some big swings.
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 that home loan rates are based on.
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, the drama in Europe helped Bonds and home loan rates reach record best levels. I’ll be watching closely to see what happens this week.
Chart: Fannie Mae 3.5% Mortgage Bond (Friday May 18, 2012)
The Mortgage Market Guide View
Don’t Click That Link!
Beware of Smart Phone SMS Scams
Smart phones can make life – not to mention business – much easier. You can send and receive text messages in a flash to clients and colleagues. You can even text links to important web pages that can be opened right on a smart phone.
Of course, those same benefits make scams much easier for criminals. Take for instance the latest craze: smishing.
What Is Smishing?
Smishing uses SMS technology to deliver fake (and criminal) messages. In fact, the name actually comes from combining the acronym SMS with the word phishing (that is: SMs + phISHING = SMISHING).
How Does It Work?
It works much like a phishing email, except you receive it on your smart phone as a text message. It starts with a text message to your phone, often stating that you’ve won a prize or that your account requires some kind of update.
Two recent smishing scams consist of text messages that appear to be sent by Best Buy or Wal-Mart, stating that you’ve been randomly selected for a $1,000 gift card. The text message includes a link to a web page that looks professional and official. But it’s not. It’s really just a clever way for criminals to collect your personal data.
What Should You (NOT) Do?
If you receive any message that seems out of the ordinary or too good to be true, take the following precautions:
Here are just a few options that you should do if you receive a suspicious message:
The bottom line is that no reputable company would text you to ask for your information. Keep your guard up and be suspicious of anything that seems odd or too good to be true. And remember to pass these tips on to your friends, family members and clients.
Economic Calendar for the Week of May 21 – May 25
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