Australia- Iron Ore, Housing and Unemployment


Speculation Mounts Over RBA October Meeting As the RBA heads towards it October meeting, there are a number of important issues on the agenda. The price of iron ore which was one of the major topics of the September meeting have now seen a 26% resurgence in price and the world’s fourth biggest exporter of iron ore, Fortescu Metals, has announced that its US$4.5-billion debt deal will now enable it to refinance any outstanding deals. The central banks in Europe and the United States have announced their intentions to fight off inflation and stimulate asset prices by printing unlimited money while China will be contributing a $150-billion package to the mix. Unemployment Despite … [Read more...]

30 Year Fixed Rate Mortgages, Nope Not at 3.25%!

30 Year Mortgae Rates at 3.25%

Fixed Rate Mortgages So is it true 30 year fixed rate mortgages are at 3.25%? Well that depends on how you look at. The answer is yes if you willing to invest discount points to purchase your interest rate down, so long as your financial profile is completely flawless. Otherwise for the 99.9% us, 30 year mortgages are trailing between 3.5% to 4.25%. That's been the reality of the mortgage bond market over the last few weeks since the 30 year fixed rate mortgage hit an all-time record of 3.53% on July 19, 2012. 30 year mortgage rates you see on television and the internet are not the best barometer of where rates truly are... Here's why: the bond market is moving all day long in … [Read more...]

Housing Prices and Inflation

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Average Housing Prices- By Jared Diamond The great recession of 2008 has been a source of enormous anxiety in the financial world. The American economy survived a total meltdown, but just barely. As American society struggles to recover, a major beast looms on the horizon: inflation. There are already increases at the gas station and the possibility of a poor harvest could result in skyrocketing food prices. The housing industry has been buffeted by the financial whirlwinds and is only now beginning to recover from years of deflated prices. Even though average housing prices have dropped along with sales, there still is a question about whether or not housing will experience a near … [Read more...]

Real Mortgage Rates

Mortgage, Inflation, and Housing Appreciation

What is the Real Mortgage Rate? At InflationData we are constantly talking about "real rates" typically by that we mean the inflation adjusted price. For instance we publish the inflation adjusted price of Oil, the inflation adjusted price of Gold, inflation adjusted stock prices and even the inflation adjusted cost of getting an education. But today when we are talking about Real Mortgage Rates we are not talking simply about the inflation adjusted price of a mortgage. To calculate the real cost of your mortgage you must also take the appreciation of your house into account.  So for example if your mortgage rate is 5% but your house appreciates 5% your real mortagage rate is zero.  The … [Read more...]

Home Prices vs. Home Values

By Charles Vollum, BIG GOLD On June 3, Standard and Poor’s issued the latest update to its Case-Shiller Home Price series. The press release begins, “Data through March 2011 ... show that the U.S. National Home Price Index declined by 4.2% in the first quarter of 2011, after having fallen 3.6% in the fourth quarter of 2010. The National Index hit a new recession low with the first quarter’s data and posted an annual decline of 5.1% versus the first quarter of 2010.” Then comes the key statement: “Nationally, home prices are back to their mid-2002 levels.” This means that on the average, a home in the U.S. that was purchased for $200,000 in mid-2002 would have sold for about the … [Read more...]

The Housing Bubble Revisited


What really makes a bubble? Are bursting bubbles inflationary or deflationary? What lessons can we learn from history? In this article Justice Litle addresses these issues. ~Tim McMahon, editor By Justice Litle, Editorial Director, Taipan Publishing Group A burst housing bubble is a harbinger of deflation, not inflation, due to massive debts incurred and massive savings lost. To really get your head around the inflation debate, it helps to understand the late great housing bubble. To that end, this description seems as informative as they come: The smell of Boom was everywhere. It caught even those who were not particularly attracted by it. A former president of Freddie Mac, … [Read more...]

Inflation and Housing Prices

Being "real tangible assets," houses tend to act as inflation hedges. But in recent times they have appreciated by multiples of the inflation rate.  This is due more to loose lending practices that to loose monetary policy.  In the following article David Galland addresses the current state of housing prices and where they might be headed. ~Tim McMahon, editor Should You Buy a House Now? By David Galland, Managing Editor, The Casey Report Recently, we have had a number of queries about real estate. And no wonder. For starters, real estate prices have come down. Plus, in an environment with next to zero interest rates, the idea of possibly picking up some income-producing property on the … [Read more...]

Who Killed the Housing Market?

The poor housing market has been big news for several months now as property owners who bought at the peak of a "housing bubble" are now having difficulty selling due to either a lack of buyers or at least a lack of buyers at prices sellers are willing to accept. So what caused this state of affairs? And who is responsible? In the following article Susan Walker of Elliot Wave International addresses this Issue.-- Editor  Wanted: Prime Suspect of Housing Market Murder By Susan C. Walker, Elliott Wave International October 8, 2007 Helen Mirren accepted her Emmy award for best actress in the mini-series, "Prime Suspect" with elegance and grace. Just the opposite of the tough detective … [Read more...]