MMG WEEKLY – WHAT ARE THEY SAYING THIS WEEK?

Forecast for the Week 

The economic calendar is light this week…but there are a few big reports due out. Here’s what you need to watch:

  • On Wednesday, the Fed will release the Meeting Minutes from its last Federal Open Market Committee meeting and the text could lead to an uptick in volatility.
  • The first economic data point doesn’t come until Thursday with Weekly Initial Jobless Claims. Last week, the number fell by 14,000. That was the first fall below 380,000 since May.
  • Friday’s data includes inflation at the wholesale level with the Producer Price Index (PPI).
  • Finally, Consumer Sentiment also rounds out the week on Friday.

In addition to those reports, it’s important to note that summer kicks into high gear starting this week, which means that volumes tend to slow on Wall Street as traders and investors take vacations. When trading volume slows, it tends to lead to increased seesaw trading, where the highs and lows could be magnified.

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, Bonds and home loan rates continue to reach record best levels. I’ll be watching closely to see what happens this week.

Chart: Fannie Mae 3.5% Mortgage Bond (Friday Jul 06, 2012)

Japanese Candlestick Chart

The Mortgage Market Guide View… 

Tweet on Saturday: Best Practices for Twitter!

A new study titled Strategies for Effective Tweeting: A Statistical Review provides scientifically based advice to help you use Twitter more effectively.

The study looked at “engagement” (by which it means retweets and replies). According to the results, brands get 29 percent more engagement from their followers when they tweet on Saturdays. That’s an even more interesting stat when you consider that only about 7 percent of tweets coming from brands actually arrive on a weekend.

And here are a few more tidbits from the report:

  • The rule of 4: Research indicated that 4 tweets per day was the most effective amount—any more than that, and engagement dropped off as people’s attention waned.
  • Twitter during day: Brands received 30 percent more clicks when they tweeted between 8:00 a.m. and 7:00 p.m.
  • Facebook at night: When it comes to using Facebook to post messages, brands saw a 17 percent increase during “non-busy” hours.

Those are just some of the highlights from the study that was released in a white paper. You can download a copy of the entire white paper at http://forms.buddymedia.com/whitepaper-form_strategies-for-effective-tweeting.html.

The white paper even includes a cheat sheet to help you make sure you’re following best practices when you Tweet!

Economic Calendar for the Week of July 09 – July 13

Date
ET
Economic Report
For
Estimate
Actual
Prior
Impact
Wed. July 11
02:00
FOMC Minutes
6/20
HIGH
Thu. July 12
08:30
Jobless Claims (Initial)
7/07
375K
374K
Moderate
Fri. July 13
08:30
Producer Price Index (PPI)
Jun
-0.8%
-1.0%
Moderate
Fri. July 13
08:30
Core Producer Price Index (PPI)
Jun
0.2%
0.2%
Moderate
Fri. July 13
10:00
Consumer Sentiment Index (UoM)
Jul
73.5
73.2
Moderate
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