Today there are reasons to feel good.
Let me start by saying that I am not by any stretch suggesting we are coming out the other side, but none the less it is a good day today, why:
- The S&P is up 450 points yesterday
- The Dow was up 290 points
- US President-elect Barack Obama has pledged the largest infrastructure package in over 50 years…this is very significant and could speed up a recovery
- Oil rebounded almost $3 a barrel
- CDN dollar up 1 cent
- TED spread dropped 1% (this shows signs of credit crunch easing…albeit we still have a ways to go)
- Bank of Canada dropped the bank rate by .75% as I predicted
- Stephan Dion stepped down yesterday, word is Michael Ignatieff will be the interim Liberal leader. This is significant because Ignatieff has not been a supporter of the coalition of idiots, and has already started to say that if Harper brings a budget he can support, he will. This also means that Harper will bring a powerful budget for our economy.
Have a great day everyone
December 9th, 2008 at 4:46 pm
Glad to see someone seeing the positive side of things. What are your thoughts on long term rates? Heading up…down…flat in 2009? Thanks,
December 13th, 2008 at 11:01 am
Long term rates will likely be slightly down through the first part of the year for two main reasons.
1) I believe banks will start to offer very special rates to customers who are in existing variable or interest only mortgages to get them to convert to fixed rates. We have seen one lender already to do this and offering fixed rates as much as .25% below the best wholesale rate.
2) As the credit markets loosen the banks spreads should drop due to normal competitive market pressure.
Trying to predict what the bond markets will do is really not a good idea these days as predicting anything right now is a pretty difficult proposition.
Greg