New Year, New Decade, Same Story

January 6, 2020

Last Week in Review: Nice Start to 2020

The new year and new decade started, and good news, some things don’t change. Stocks picked up right where they left off in 2019 by touching all-time highs. And Bonds, which also performed well in 2019, continue to hover near three-year highs, keeping home loan rates near 3-year lows.

Many are wondering how the economy and markets will perform in 2020. So, for that reason, here are 3 trends to follow:

      1. Don’t fight the Fed. As the saying goes, there doesn’t appear to be any chance of a Fed rate hike in 2020. The economy is strong, but not too strong. Plus, the Fed is fighting disinflation, so a rate hike would counter those efforts. Moreover, it’s a presidential election year and the Fed has historically tried it’s best to avoid any monetary policy moves in those years. Bottom line: good for Stocks and less good for Bonds.
      2. Stock gains. Post-World War II, Stocks on average have gained 10.1% in presidential election years where the incumbent is up for re-election. It’s tough to fight that trend, even with Stocks soaring in 2019. Bottom line: Stocks are set to finish 2020 higher.
      3. $1,000,000,000,000. That was what the U.S. spent in holiday retail shopping in 2019. That massive record highlights the strength of the U.S. consumer who makes up 70% of the U.S. economy. Bottom line: there is no recession in sight, great news for housing and the overall economy.

Bottom line: absent of a Black Swan event or unforeseen negative surprise, 2020 is shaping up to be a great year for housing and the U.S. economy, with the labor market strong, wages rising, inflation muted, and interest rates low.

Government Agency Approvals

FHA Non-Supervised Mortgagee Approval #:
24751-0000-5
VA Automatic Lender Approval #:
902324-00-00

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Carrington Mortgage Services LLC
ISAOA/ATIMA
P.O. Box 692408
San Antonio, TX 78269-2408

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This information is provided for your convenience and Carrington Mortgage Services, LLC makes no warranties concerning the accuracy or completeness of any of the information. This is not financial or legal advice and should not be taken as such. This information is for mortgage professionals only and is not intended for distribution to consumers.
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Government Agency Approval | FHA Non-Supervised Mortgage Approval #: 24751-0000-5 | VA Automatic Lender Approval #: 902324-00-00

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