Seattle Mortgage Rates 9/12/12
Seattle Mortgage Rates Today 9/12/12: “And the German High Court says…” Finding that the Euro Zone bailout furthered by European Central Bank President Mario Draghi is legal, stocks are getting a boost this morning at the expense of bonds. In order to maintain control, the German court contended that that the German parliament should have the authority to veto any increase in the country’s contribution to the European Stability Mechanism (ESM)—the organization that aids Euro Zone members in financial distress. Last week, Signore Draghi stated that he would purchase an indefinite amount of sovereign bonds from Italy and Spain to control their unsustainable borrowing costs. It was noted as positive news; however, at the time, skeptics waited for the ESM to come into play.
“QE 3! Come on down, you’re the next contestant on ‘Another Round of Easing!’” In anticipation of the Fed’s statement on easing, there is uncertainty in the way markets will react, analysts contend. The 2 earlier rounds of easing we saw bonds suffer. However, we should also note that QE 1 and 2 did not reach expectations in aiding the economy. Perhaps markets will see QE 3 in a different light—there may only be a slight uptick in stocks and bonds won’t lose much ground. Let’s see what the Fed announces tomorrow.