阅后即焚(二十四)

Sept 15, 2013 – Home-Sales Frenzy Eases

  • meaured by Credit Suisse, home-buyer traffic fell in August to its lowest level since December 2011;
  • (Dow Jones Newswires) pace of sales fell to 5.24 million annual rate, down 3% from July;
  • New home sales declined 4% in August;
  • Mortgage rates climbed from 3.6% in May to around 4.8% last week;
  • (some agents) the biggest problem in the market is “selling greed” – seller pricing too high;
  • share of investors buying homes down from 20% (one year earlier) to 18% in July – appears to have lost interest;

Sept 16, 2013 – China Telecom Cuts iPhone Subsidies

  • iPhone 5S 2398 yuan compared to 1888 yuan for the iPhone 5 for a two-year data plan;
  • subsidies for iPhone from U.S. carriers make it comparable to other top-end phones, in China it usually remains more expensive;
  • cutbacks comes in part because China Telecom is trying to increase its profitability;

Sept 16, 2013 – Summers’s Withdrawl Cheers Markets

  • a sign of continued easy-money policies;
  • Summers seen as the most hawkish of the candidates for the Fed;
  • scaling bond purchases leading to an outflow of capital from emerging markets; pushing their currencies down and forcing authorities to tighten monetary policy to attract funds.

Sept 16, 2013 – Fed Faces Tough Sell on Low-Rate Strategy

  • Fed trying to shift from bond buying to the low-rate pledge – both are meant to stimulate higher risk tolerance in financial markets, and encourage borrowing, spending, investing, and economic growth;
  • Fed’s guidance on future short-term rate has a substantial influence on where markets move today’s long-term rate (such as those for mortgages, car loans and business borrowing);
  • inconsistency: neutral fed funds rate should be around 4% but latest official projections expect it to be about 1%;
  • simple explanation: lingering effects of the 2008 and 2009 financial crisis, requiring the continued support of interest rate below the level.

Sept 19, 2013 – Home Sales Hit Highest Level Since 2007

  • buyers rushed to lock in deals before mortgage rates increased further;
  • August, existing-home sales rose 1.7%, best since February 2007;
  • slower pace of sales of new homes – buyers can’t lock in a mortgage rate on a home that is under construction;
  • inventories of previously owned homes remain tight; down 6% from a year ago;

Sept 19, 2013 – Investors Now Left Wondering

  • though sending U.S. stock indexes to records, in the longer term, less positive: if Fed are right, that could presage disappointments in 3Q earnings; and Fed still expected to reducing stimulus at some time this year – sending more uncertainty and confusion to markets;
  • worry that U.S. stocks are overpriced and too dependent on government support; should think about moving some money into European and developing-country stocks;
  • $85 billion-a-month bond buying: goes to bank, finds its way into the riskier stocks and bonds investors think will get the best short-term pop; bond not benefit the most since investors still think the Fed will cut back later in the year, and thus channel the liquidity into riskier, faster-rising investments;

Sept 19, 2013 – Companies Seize on Rate Reprieve to Issue Bonds

  • Companies took advantage of the Fed’s surprise decision – selling debt;
  • tapering, most likely to occur at the December meeting, given not much time for officials to consider new economic data;
  • Vesizon’s $49 billion bond deal last week, among companies that sold debt ahead of the Fed decision – lower than the trading price of the company’s existing debt, potentially costing more than it needed – still make sense;
  • opportunity to buy IG corporate bonds: threat of rising interest rates – which decrease the prices of outstanding bonds – has passed at least for now.

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