Thursday 9/11 ... Remember

Take a moment today to remember the people whose lives were lost and whose lives where forever changed in the 9/11

attacks in 2001....

Today we had the release of several economic reports. First of all, the weekly jobless claims came in at 445,000

where economists where expecting 440,000. So, this report was a little worse then expected which continues to show

that wage based inflation is well under control, which is a good sign of lower inflation. Remember, lower inflation

is good for mortgage rates. Next we had the release of the Trade numbers. Our trade balance came in worse then

expected at -$62.2billion vs expectations of -$58billion. More importantly to us, the prices paid for imports fell

by 3.7. This is good news as the prices of products we import are falling in price which will help to moderate

inflation. Remember, the Fed's have been saying that the believe inflation will moderate as the year progesses and

we are starting to see that in the economic reports.

Since the great gains we got on Monday, rates have slipped back a little and look to move sideways. Tomorrow brings

us an action packed day of economic reports that should have a impact on rates. First the producer price index,

which measures the change in prices that producers are paying for a fixed basket of goods. This is a key measure of

inflation. We also get the release of retail sales which is a key measure of the strengh of our economy. Generally

speaking, lower inflation tends to lead to lower rates and bad economic reports tend to lead to lower rates.

As for today, floating looks like the way to go. If you believe the inflation reports will be higher then expected

or if you believe retail sales will come in higher, locking later today would be the safe call and a good call. It

has been our opinion that inflation is moderating and the economy is not booming, so for longer term closings

floating could pay off. Take you own risk awareness into account and make your decision accordingly. As always,

for a more technical analysis, click on the professional blog and we will report back if we see the market start to

deteriorate.