The January 2012 Non-Farms Employment report flat knocked the ball out of the park with 257,000 new jobs created, unemployment down to 8.3% and an upward revision to November & December 2011 figures of an additional 60,000 jobs. In nutshell this was the strongest report since April 2011.

Jan 2012 employment history

However according to Rick Santelli, my favorite maven from the Chicago Board of Trade, while the figures are good on the surface the story not being told is that there are an estimated 1.2 MILLION people no longer looking for work so they are NOT counted among the unemployed. If they were included in the figures this would be the worst report since 1981. He likens today’s report to a company reporting excellent earnings only to find out that they had a one-time-writeoff that artifically raised net results. In a nutshell, bad news.

So – best report since April 2011 -or- worst report since 1981 – you decide. Either way, stocks took off and took rates along for the ride.

Call Todd Abelson for all your mortgage needs at 520-331-LEND (5363)

…they didn’t raise rates. This was a unanimous vote of the Committee.

More importantly, during Bernanke’s speech he confessed that even he was more than curious why the Economy is still in the duldrums and the recovery “frustratingly slow”.

On the Inflation front the Committee pledged to keep rates low for an extended period (a term the Bond markets liked). Indications are it will take another 2 or 3 Fed Meetings before they will consider raising short-term rates, which should take us close the the end of 2011.

On the Monetary front they announced that QE2 would end as scheduled on June 30th with no mention of QE3. The Stock markets reacted very badly to this news in that both QE1 & QE2 have been leading reasons for gains in the market. Once removed, what will happen? The Dow shed 180 points yesterday and is currently down another 215 points.

So the actual news was kinda-sorta what we expected and the Bond market pretty much took it in stride. Now while stocks give up recent gains, rates have improved… but for how long? Volatility still reigns supreme.

Call Todd Abelson at (520) 331-LEND (5363) for all your mortgage needs!

So the topic on every Investor/trader’s mind is “what will the Fed say when their statement is released?”

Is the economy going good/bad, stong/weak, sideways/forwards/backwards?

Will there be a “QE3″ program or do they capitulate that Monetary Policy has failed and now only Fiscal Policy can save the day?

Are they going to accelerate the sale of Gov’t holdings to recoup some of the money invested from QE1 and QE2?

How long is “transitory” when Bernanke says the current inflation we’re witnessing is transitory?

Will they, in fact, raise short-term interest rates this morning?

Is there ANY CHANCE we’ll step into the Euro-debt crisis?

Is the bad news not as bad as we think, which makes it good news? Or is the good news not as good as we hoped, which makes it bad news?

My head hurts!

Any way it goes, there will definately be some sort of knee-jerk reaction as Volatility reigns supreme. So tighten your seatbelt and hang on for the ride!!!

Todd Abelson, Licensed Mortgage Professional, (520) 331-LEND (5363)

Courtesy of Don & Kathy Vallee from RE/MAX Excalibur in Tucson, Arizona.

Click here to download a copy of the most recent weekly report. Great thumbnail information!

Call Todd Abelson at Sunstreet Mortgage for all you Mortgage needs! (520) 331-LEND (5363)

Oil just hit a high of $111 per barrel.

Gold just hit an all time high of $1,472 per ounce.

US Debt is just about to hit the ceiling of $14.3 TRILLION and a government shut-down seems inevitable. If so, even if “only” over the weekend, expect rates to spike HIGHER.

Ponder these mortgage points as well…

• No IRS Transcript requests (4506-T) will be processed (no loans can be funded)
• No USDA loan Certifications (no USDA loans can be funded)
• No VA or FHA Case #’s can be ordered (no files can be processed)
• What if employees are the Federal Reserve are put on hayatis? (loan fundings may be delayed).

Mind boggling! Hang on, it’s going to be a bumpy weekend (and week to come?)…

Todd Abelson, Licensed Mortgage Professional, 520-331-LEND