Daily Commentary by Larry Baer: Uncle Sam will wrap up this week's
scheduled three-part debt auction with the sale of $16 billion of 30-year bonds
this afternoon at 1:00 p.m. ET. I will post the result on my website as
soon as possible once the final gavel falls.
Later today Senate Democrats
will unveil a $120 billion plan for a 10-month delay in the automatic spending
cuts set to begin March 1st. Half of the cost of putting off
the cuts will be covered by revenue increases and the other half by direct
expenditure curtailments. The Republican controlled House will likely
reject the plan on its face because it contains increased tax provisions.
Unless Congress and
the White House can find common ground in a hurry - it looks as though $1.2
trillion in across-the-board spending cuts, know as sequestration, will begin
to take effect at midnight February 28th. If such an
event does occur it will likely create selling pressures in the stock markets
which should, in turn, provide strong support for the prospects of steady to
perhaps fractionally lower mortgage interest rates.
The Labor Department
said the number of Americans filing first-time claims for government jobless
benefits fell by 27,000 to a seasonally adjusted 341,000 during the week ended
February 9th. Thirty-five states and territories reported an
increase in the number of claims filed, while 18 reported a decrease.
Market participants see initial weekly jobless claims data as an indication of
the pace of weekly firings - not as a direct indication of new job creation.
Even so, a decline in the number of people filing weekly jobless claims is
viewed as a hopeful sign labor sector conditions may be improving.
Mortgage investors will keep an increasingly keen eye on the trend of the
weekly jobless claims data - even though they largely shrugged off today's
stronger-than-expected number.
THE
MARKET IS ALWAYS RIGHT! . YOU AND I ARE SOME OF THE TIME
