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The light at the end of the tunnel!

Happy Market Update!

We are nearing our holiday season! Yes, I am a lover of Christmas…at least the idea of Christmas. Not the presents part…or white elephant, whatever the hell that is. I struggled with it as a kid. Being comfortable is not something I have mastered in my life…and giving gifts, and especially receiving gifts, was an uncomfortable moment in my life. The best I can do is say it has something to do with some part of my upbringing not centered around Christmas, but in family and life in general. I’ve met a lot of people like this as well. So I will continue to stress to everyone that Christmas is not about giving gifts. It’s about celebrating the people you care about. Yes, if you have some frankincense, offer it to Baby Jesus. Afterall, that’s the original Christmas.

But I would be beaten by some of you if I did not remind everyone that there is a holiday before the gift one. Thanksgiving! Regardless of your political affiliation, your culture beliefs, or your current income/employment situation, you must find time to give thanks for the good things in your life. Yes, there are things. If you are as dramatic as I can be, there are times it doesn’t seem like it. But on those days, I’ll find out that someone passed, there was a large accident on the highway, or someone lost a job. It’s the universe giving us the opportunity to change our attitudes. Over the years I have tried and failed to write in a gratitude journal, mainly because I hate to write and read. Make a movie, I always say. But just look around you…if you are employed, give thanks. Not everyone is. If your team isn’t making the playoffs, be thankful for the times they did make it. Not everyone makes the playoffs (I’m looking at you, Jets fans). But you must take a moment, alone or with family, and actually be thankful. Say it out loud!

Here's an example. I could be upset about losing Tex this year. But instead, I am thankful for the 12 good, strong years he was in my life. He made me be a better parent to Jackson in the future. He encouraged me to finish the climb to 10 14ers here in Colorado. And even in the final moments, he reminded me what love is. I am thankful for you, Tex. See?! Not so hard.

Need another example, you can be thankful for the fact that this newsletter will not be the normal doom and gloom. I might throw one in there from time to time, but there is some positive…and I’m proving I’m not a permabear! So make sure to be thankful for me not completely depressing you today.

How would we start with good news? How about our CPI numbers from Tuesday?! Yes! Moved down…and your 401ks loved it! Go look! (but hurry, who knows that chaos is coming.) CPI is the measure of inflation that the markets have bee looking for to give an idea of future Fed increases in the Fed Funds Rate (which directly impacts your home equity lines of credit AND credit cards). So that’s good news #2! More on that in a moment. First, CPI…look at the growth of CPI slowing. Inflation is still rising, but tapering off. For now.


For those of you who miss my “but here’s the problem”, this section is for you. Bulls…you will want to skip this next chart. See the highlighted number? That’s a negative 34 calculated into the CPI for “Health Insurance”. Did your insurance get cheaper? Has it ever gotten cheaper? So something isn’t right here. Don’t go to your market and assume that cereal box didn’t get smaller or more empty. It still did.

Welcome back, bulls! As I stated before, the markets are thinking the Fed is done with raising rates! This chart shows not only the belief that it will no longer go up, but it will actually start to go back down maybe by as early as Spring! Wow! For those of you working to get those credit card bills paid, this would be welcome news!

And another slide to back that up…info from the CME:

Bulls move to next slide. People who like horror movies…welcome back. Why is this Fed Funds Rate pausing and then moving back down good to hear? Because that credit card debt continues to rise. That’s not the only thing rising around credit cards. So are the credit card delinquencies. This chart shows that we are at levels higher than even during the housing crisis! Now, maybe that’s because everyone had already taken cash outs to pay off their credit cards (and buy boats, campers, expensive watches, 7th homes, etc).

Everyone back? Good. Remember I said, ‘tis the season? Well, this will make you want to run out and buy more stuff! (But don’t…those credit cards don’t have room.) This is a seasonality index for the S&P 500 that shows, on average, what the market does. Check out that run up! Man, load up that 401k or IRA! No, I am not giving stock advice. I’m really bad at that. For now. It’s not the Santa Claus Rally. That’s a very specific timeline later this year. But looks merry anyway, right?!

But what if there is nothing left in the 401k? A Yahoo Finance article from Saturday, Nov 11th, written by Kerry Hannon indicates that, “Americans continue to ransack their retirement savings.” Why would this be the case if the economy will be fine and people have money? Spoiler: they don’t! She goes on to write:

How’s all this working for our country? It doesn’t help at all. In fact, last Friday, Moddy’s moved their outlook on US debt to negative. From the Wall Street Journal, reported suspiciously after markets closed on a Friday…when a lot of us where no longer paying attention to the news. Good news, Biden rejected it. So there’s that. What would you like to reject in your life just because you THINK you are in charge? Haha. But this is what they do before they move a rating down from an AAA…which would not be good for selling our debt. We had a pretty bad 30yr auction last week. Basically, no one wanted to buy our debt. This just makes it worse in the future. But at least it looks like Moddy’s learned something from the housing crisis. Maybe.

But hey, don’t piss off Biden. That’s not my talking. I would assume that New York City Mayor Eric Adams is talking about that now. He has been vocal about our southern US border after some border states bussed a lot…I mean a lot…of illegals to his “sanctuary city”. He was vocal to DC. And I guess DC didn’t like it. Now, the DOJ has been probing him and seizing electronic items of his. Again, below, from the WSJ. So our government is literally the mob now. That’s why we are not a first world country anymore…and that’s from someone who does not agree with Mayor Adams on a lot of issues. Before you ask, Biden and Adams are of the same political affiliation.

10yr: I know there are a lot of lines on here. Ignore all the yellow ones. Just know that we are moving down from the highs in October. If the Fed is truly done raising, and the economy is lowing with less and less job growth, then we have seen the highs. This will be welcomed news to our mortgage and real estate family. We have a long way to go, but hopefully, the trip has begun.

MBS: Yes, another smiley face! Reminder that the MBS moving up, means lower rates. So up is good. We need to break above the green downtrend line (that’s the 100 day moving average), and then move up and above that purple one for some real action. But the good news is that we have not had a close above that green line before yesterday since May. And I feel I can speak for the people in my office…anything different is good!

I will be off next week from this newsletter…although I might send one if something interesting happens. Not because I take time off…but because I do not want to create more emotion in you as you head into family time. Watch your football teams if you want emotion. I am thankful for each of you taking the time to read my intro…or making it all the way here to see I am thankful. Now, do the right thing…and do not eat anything with mayo. Get some biscuits and gravy…and then more. Calories don’t count during Thanksgiving weekend. That’s not me telling you…that’s science.

What doesn’t kill you, makes you stronger.


Tim Lindsey

President/Sr. Loan Officer

Bear Mortgage Inc.

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