Today expectations of the mark to market ruling became a reality. Changes are on the way and as we mentioned in the past few weeks emails, the stock market is enjoying a nice rally as a result. One of the major advantages will be a reduction in the amount/number of “write-down’s” that banks have been forced to make under past guides on investments such as mortgage backed securities. Some experts are saying that banks may see earnings jump by 20% or more in 2009 Q1. Could be good for liquidity and the overall economy.
Today’s developments weave nicely together with some other positive news we have seen in recent days. It is all starting to possibly outline what many people are saying could be the end of the recession. Stay tuned for more on that!!
The real kicker as we have mentioned before is the unemployment report. Tomorrow’s report is destined to be another flopper with + or - 700,000 new claims. Although this is tough, and we all likely know at least one person affected directly by this we have to be patient. The unemployment report and numbers will be the last item to show improvement, but when they do we can be sure we are well on the road to recovery.
FYI - Mortgage Rates increased slightly today as a result of money flowing into the rallying stock market, but have no fear, rates are going to hold steady and remain at or near recent lows for sometime barring any major surprises.
Your Trusted Advisor,
Jeremy House, C.M.P.S.
