The Weekly Rap! Friday June 12th 2015

If you like this commentary please visit and “Like” my Facebook pageI put all of my prospective buyers through underwriting so that when they place their offer, it is as close to “cash” as you can get.  So to get your clients “underwriter approved”, please contact me and get your offer accepted!

The National Debt is currently: $18,263,639,132,587.00  is Higher by another 9 BILLION.  The interest pay-out alone on the debt is 244 Billion per year!  I post this so we will be aware of what we are leaving to our children.

The Dow last traded at 17,880 right where it was last Friday.  The S&P 500 is trading at 2,092.  Gold is trading at $1,179 an ounce, while oil futures at $60.00 a barrel.  Gas prices, (Regular in El Dorado Hills, Costco, AM/PM), are at $3.03/Gal.

The FNMA 30-year fixed 3.0% coupon (interest rates at which banks sell their loans into Fannie Mae), containing 3.25% – 3.625% mortgage rates, the benchmark or how rate sheets are priced these days is currently trading at 99.28 right where we were last week.  Our current trading range has now shifted lower and is about 98.5 to about 100.5.  Each .50 change in the price of the security translates to about 0.125 in rate.  If we can hold at these levels I expect that we will trend back to higher levels.  Basically the change in the price of the security translates to the price (or points paid or credited) of the mortgage rate.  The higher the number (price), the lower the rate.     

In economic news this week; It was another busy week of economic data, and the reader’s digest version is the economy may by showing signs of life.  Yesterday we learned that Retail Sales for May were +1.2%, Import Prices were +1.3%, Initial Jobless Claims were below 300k for the 14th straight month. NAR was also out saying 2015 could be the best year in housing since 2006.  So why wouldn’t rates go up?  Well, the IMF is butting heads with Athens: stalled negotiations between Greece and its creditors caused a flight to quality in our country.

So does anyone remember the Sacramento radio station KZAP from back in the day?  Well the station (and the Cheshire Cat) are making a comeback.  I can’t believe it! Finally a station will plays Rock music from all decades! We have every other station “Genre” out there but the only Rock station is Classic Rock. KZAP was my favorite “go to” station growing up and I am glad they’re coming back. KZAP will appear at 93.3 on the FM dial as well as streaming live at They will have donations, grants and underwriting instead of ads, with only three minutes of every hour earmarked for sponsor breaks. Finally a station where you can actually tune it in for extended periods without saying, ‘I just heard that an hour ago! Go KZAP!

KZAP Cheshire Cat Reduced to 5x3

Small-business sentiment improved in May. The National Federation of Independent Business small-business optimism index rose 1.4 points to 98.3, the highest level since December, as six of ten components improved. That puts the index in line with its historical average of 98, the NFIB said.

Our Federal government ran a budget deficit of $82 billion in May, the Treasury Department reported. The May deficit is $48 billion lower than the same month a year ago. The government spent $295 billion in May, which was $35 billion, or 11%, less than a year ago. Total receipts in May were $212 billion, an increase of $12 billion, or 6%, over last year. For the fiscal year to date, the budget deficit is $365 billion, a decrease of 16% from the first eight months of fiscal 2014. Again, when are they going to balance their checkbook?

Sales retailers climbed 1.2% in May and rose for the third month in a row, offering more evidence of springtime rebound in consumer spending after a winter lull.  Auto dealers and gas stations posted the strongest sales, but most major retail segments did see healthy gains.  Excluding autos, sales rose 1%. Sales minus autos and gasoline climbed 0.7%, the Commerce Department reported. What’s more, sales in April and March were stronger than initially reported.  Retail sales rose 0.2% in April instead of being unchanged. Sales in March were revised up to 1.5% from 1.1%.

Wholesale or “Producer” prices rose 0.5% in May, driven by a rise in the wholesale cost of gasoline and other fuels.   The increase in the producer price index, the largest since September 2012, was the second in three months following four straight declines.  The price of goods rose 1.3%, while services were unchanged, the Labor Department reported. Yet even with the advance in May, producer prices over the past 12 months are 1.1% lower.  Excluding the volatile categories of food, energy and trade, core prices fell 0.1%. The core rate has risen 0.6% in the last 12 months.

Consumer sentiment rose to a preliminary June reading of 94.6, rebounding from a drop for May’s final result, when the gauge hit a six-month low of 90.7, according to reports on the University of Michigan gauge released Friday.  The Economites follow readings on confidence to look for clues about consumer spending, the backbone of the economy.  For context, the consumer-sentiment gauge averaged 86.9 over the year leading up to the recession.

On the Employment front:    Job openings at workplaces rose to a record high of 5.38 million in April from 5.11 million in March, the Department of Labor reported. Compared with same period in the prior year, April’s job openings rose 22%, as private-sector openings increased 21% to 4.89 million, and government positions rose to 489,000 from 367,000.  With 8.55 million unemployed people in April, there were about 1.6 potential job seekers per opening, below March’s ratio of 1.7.  In April 2014, there were about 2.2 potential seekers per opening. When the recession began in December 2007, there were about 1.8 potential job seekers per opening. The number of separations, such as quits and layoffs, dropped to 4.88 million in April from 5.07 million in March.  Meanwhile, the total number of hires declined to 5.01 million from 5.09 million. The level of hires was about 5.04 million when the recession began.  In other words we’re pretty close to pre-recession numbers.  It just took almost eight years.

The number of people who applied for unemployment benefits rose slightly in the first week of June but remained near a 15-year low amid a sharp upsurge in hiring over the past few years.  Initial jobless claims edged up by 2,000 to 279,000 last week. Initial claims have been under the key 300,000 mark for 14 weeks in a row, a feat last accomplished 15 years ago.

Fun for the day: 

Under the age of 40? You won’t understand. Part 1 of 2

Ø  My mom used to cut chicken, chop eggs and spread butter on bread on the same cutting board with the same knife and no bleach, but we didn’t seem to get food poisoning.

Ø  Our school sandwiches were wrapped in wax paper in a brown paper bag, not in ice pack coolers, but I can’t remember getting e Coli.

Ø  Almost all of us would have rather gone swimming in the lake or at the beach instead of a pristine pool (talk about boring); no beach closures then.

Ø  We all took PE – and risked permanent injury with a pair of Dunlop sandshoes or Converse high tops instead of having cross-training athletic shoes with air cushion soles and built in light reflectors that cost as much as a small car. I can’t recall any injuries but they must have happened because they tell us how much safer we are now.

Ø  We got the cane for doing something wrong at school, they used to call it discipline yet we all grew up to accept the rules and to honor & respect those older than us.

Ø  We had 30+ kids in our class and we all learned to read and write, do math, and spell almost all the words needed to write a grammatically correct letter – imagine that!

Ø  We all said prayers in school and sang the national anthem, and staying in detention after school caught all sorts of negative attention.

Ø  We also learnt our times table by reciting them every day.  

Stay tuned next week for part 2 of 2…..

You can visit my corporate website at:


Bill Bartok

Mortgage Advisor MLO# 445991

The nicest compliment I can receive is the referral of your family, friends and co-workers.

Thank you!


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