Thursday, July 30, 2009

Traders are in a gloomy mood as they await the results of today's $28 billion 7-year note auction.

Poor reception to yesterday's 5-year note offering followed meager bidding, especially by foreign investors, at Tuesday's $42 billion two-year debt sale. Demand for yesterday's 5-year note offering was the lowest in almost a year. An increasing number of market participants are coming to believe the stellar results from Uncle Sam's debt auctions just a few weeks ago were a fluke. Let's hope that assessment proves to be a bit overwrought.

The "so what" factor here is simple and straightforward - a poorly bid 7-year Treasury note auction today will likely serve to push mortgage interest rates higher. Overseas buying of Treasuries, by central banks in particular, is seen as a critical supportive element for the prospects of steady to perhaps fractionally lower mortgage interest rates. Without the strong participation of foreign investors interest rates (including mortgage rates) could rise throughout the economy at a faster pace than might be appropriate given the lingering effects of the worst recession in decades.

The Labor Department reported this morning that the number of workers filing first-time jobless benefit claims during the week ended July 25^th rose by 25,000. This data has been distorted during the last several reporting periods by the impact of major layoffs in the auto and related industries. A Labor Department spokesperson indicated the majority of the earlier data-warp has "worked itself out." The four-week moving average for new claims, considered to be a better gauge of underlying trends as it smoothes out week-to-week volatility, fell by 8,250. This was the lowest level for this economic metric since January -- and it marked the fifth straight week the average has declined. Mortgage investors barely noticed the suggestion embedded in this data that the pace of firings in the nation's work force is flattening out considerably. The labor sector data will draw more attention within the next two weeks - but for today the result of the 7-year Treasury note auction trump all else.

Wednesday, July 29, 2009

The going is likely to be a little tougher for Uncle Sam as he brings $39 billion worth of supply to the credit markets today. The Treasury Department's auction of these 5-year debt obligations will conclude at 1:00 p.m. ET.

Lackluster results from yesterday's $42 billion 2-year notes amid below-average foreign investors demand have market participants concerned that today's offering will suffer a similar fate. If Uncle Sam finds it necessary to "sweeten-the-pot" by discounting the accepted price to entice investors to cough-up the capital he is seeking -- it is highly likely mortgage interest rates will creep higher before the end of the day. From a technical perspective it appears likely that any "pot sweetening" by the government will be very limited - if it proves necessary at all. If assessments are accurate, today's 5-year note auction will likely have little direct impact on the trend trajectory of mortgage interest rates today.

The Commerce Department reported earlier this morning that new orders for durable goods (items manufactured to last three-years or more) notched their biggest decline in five months in June. Durable goods orders dropped by 2.5% last month -- marking the largest slump in this economic metric since January. The headline number was pulled lower by a steep decline in demand for transportation and communications equipment. The report was not completely bleak -- there were some bright spots in this morning's data. New orders excluding transportation rose 1.1% in June, the biggest rise since February, after climbing by 0.8% in May. Non-defense capital goods orders excluding aircraft, a closely watched proxy for business spending, rose 1.4% last month after posting a 4.3% gain in May. Even though the headline number fell well below the consensus estimate for a decline of 0.6% -- the June durable goods orders report in total appears to be flashing preliminary signs the worst of the massive decline in the manufacturing sector may soon be behind us. That's good news for the economy in general - but not quite so encouraging for the prospects of notably lower mortgage interest rates.

Separately, the Mortgage Bankers of America reported their seasonally adjusted index of mortgage application activity fell 6.3% during the week ended July 24^th. That was the first decline for this index in four weeks. The drop was driven by a 10.9% slump in demand for home refinancing loans while requests for a loan to purchase a home were flat.

Tuesday, July 28, 2009

Uncle Sam is splashing around in the credit market today -- looking to borrow a record-setting $42 billion in the form of 2-year notes. The auction will conclude at 1:00 p.m. ET.

The majority of analysts (me included) believe the two-year note auction will go off without a hitch since its short-maturity makes it far less vulnerable to economic and financial market uncertainties. The fact that the entire complex of government debt obligations is offering investors the highest inflation-adjusted yields in 15-years is certainly contributing to the success of the Treasury's debt auctions as well.

News earlier this morning from the private Conference Board, a non-profit global business organization, indicating their Consumer Confidence Index slumped for the second consecutive month boosted the attractiveness of government debt obligations and mortgage-backed securities at the expense of stock valuations.

The consumer confidence index dropped to a reading of 46.6% in July from the June mark of 49.3%. The confidence gauge stood at 54.8% in May. According to a Conference Board spokesman, the decline in consumer confidence during July was caused primarily by a worsening job market. The component of the index that measures consumers' forward looking expectations fell as well - driven lower by Main Street opinions that labor market and business conditions are unlikely to change for the better in the next ninety days. Interestingly, most survey participants stated they don't believe economic conditions will worsen over the same period of time. This disconnect between the present and future expectation components of the Consumer Confidence Index is widely viewed by many as one more bit of anecdotal evidence suggesting the economy is engaged in a bottoming process as the most severe recession since the Great Depression draws to a close. I hope these early calls are right - but I personally believe it is way too early to celebrate the demise of the wicked recession witch by dancing in the street.

Monday, July 27, 2009

Mortgage investors have absolutely no incentive to step in front of the government supply train coming down the tracks this week.

Uncle Sam will be in the credit markets every day through Thursday looking to borrow a record setting $115 billion. The first car load of supply arrives today in the form of $6 billion of 20-year inflation-indexed securities, followed by Tuesday's $42 billion of 2-year notes, $39 billion of 5-year notes on Wednesday and $28 billion of 7-year notes on Thursday.

Most investors will likely choose to stand well back from the tracks for fear that the massive weight of government debt supply combined with signs of economic recovery followed by an attendant improvement in stock prices could cause a major derailment in the credit markets violent enough to push mortgage interest rates notably higher.

It is worth noting that overseas investors, including foreign central banks, have been strong participants at this year's Treasury auctions - and there is little reason to believe their participation levels will be notably worse this time around. Even so, look for mortgage investors to be very cautious with their pricing strategies until there is clear evidence demand for Uncle Sam's debt offerings has not waned.

This morning's stronger-than-expected June New Home Sales numbers certainly did nothing to brighten the mood in the mortgage market. According to Commerce Department figures new home sales climbed 11.0% on a month-over-month basis in June. The inventory level of new homes on the market has now fallen to its lowest levels since February 1998. While the data continues to point to a housing sector attempting to put in a bottom -- few analysts are willing to declare the end of the worst decline in new home sales in decades. The "all clear" signal will only be given once sale prices begin to trend higher - and that was clearly not the case in June -- as the median new home sales price fell 5.8% from the month earlier mark.

Wednesday, July 22, 2009

Second verse - same as the first.

Fed Chairman Bernanke told mortgage investors just what they wanted to hear yesterday when he promised the central bank has the will and the tools necessary to guide the economy out of recession without spurring inflation. He made those reassuring remarks during his semi-annual monetary policy testimony before the House Financial Services Committee.

Mr. Bernanke is making an encore appearance this morning before the Senate Banking Committee where he will read yesterday's prepared text testimony verbatim into the congressional record for the second time.

He will once again be grilled by lawmakers on everything from his views on President Obama's healthcare plan, to unemployment, to what impact, if any, he thinks the birthrate of coyotes in New Mexico will likely have on the future level of short-term interest rates (I obviously made that last part up - but it is my tongue-in-cheek attempt to highlight how poorly versed some committee members truly are on topics related to the economy and interest rate movement). There is little reason to expect the Fed Chairman will fail to handle every question, no matter how relevant or ridiculous, as deftly as he did yesterday during his appearance before the members of the House committee. Mr. Bernanke will simply reinforce his position that while the Fed is keenly aware of the potential inflation threat down the road - the central banks has the tools to control that threat - though it is highly unlikely it will have to use any of the inflation fighting options at its disposal anytime soon. If this assessment proves accurate, this event will have little, if any discernable impact on the direction of mortgage interest rates today.

Separately, the Mortgage Bankers of America released their seasonally adjusted index of mortgage applications for the week ended July 17^th earlier this morning. The indexed showed that total applications during the period rose 2.8%. Applications for home purchase climbed 1.3% while refinance applications were up 4.0%.

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Tuesday, July 21, 2009

Well done Mr. Bernanke.

Mission accomplished - you brought congressional members up-to-speed on current monetary policy, you adequately answered questions regarding the mechanisms available to recover the enormous amount of stimulus that has been injected into the economy without spawning massive amounts of inflation, and you withstood the badgering of a few less-than-informed legislative hacks. Had you failed to complete your tasks today so masterfully - the credit markets would now likely be engaged in a full-out, fear-driven rout.

It was almost possible to hear the collective sigh-of-relief from mortgage investors as Chairman Bernanke told members of the House Financial Services Committee that the weak economy will warrant exceptionally easy monetary policy (low interest rates) "for an extended period of time." There was nothing in Mr. Bernanke's prepared text testimony -- or in his responses during the question-and-answer session that followed his formal comments -- that caused investors to believe the central bank was anxious to remove excess stimulus from the system.

Credit market participants in general, and mortgage investors specifically, were soothed by the Fed Chairman's statement that assets on the Fed's balance sheet "may remain very large for some time" - an indication the Fed has no immediate plans to begin off-loading their massive mortgage-backed security position. Some analysts are still suggesting the Fed will ultimately announce their intention to hold their entire $1.2+ trillion residential mortgage portfolio to maturity - but I strongly suspect that will prove to be little more than an exercise in wishful thinking. At some point in the future the Fed will almost certainly become a major seller of mortgage-backed securities as they methodically begin to unwind the various elements of their "quantitative easing" programs - but that event is unlikely to take form this year.

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Monday, July 20, 2009

This morning's release of June's leading economic indicators put mortgage investors a little on the defensive as the day began. The index, designed to project economic trends six to nine months ahead, rose 0.7% last month. Most economists had anticipated a positive reading in the neighborhood of 0.5%. The index value for May was revised to reflect a 1.3% gain versus the 1.2% improvement initially reported. The leading economic indicators have now posted three consecutive monthly gains. If this trend continues, although large job losses will continue to be part of the landscape, we will almost certainly see a slow improvement in overall economic growth this fall. Today's surge in the leading economic indicators was broadly anticipated - and therefore its impact on the current level of mortgage interest rates was barely discernible.

Mortgage investors will be keenly interested in what Fed Chairman Ben Bernanke has to say about the state of the economy when he goes to Capitol Hill tomorrow and Wednesday to present his semiannual monetary policy testimony. Mr. Bernanke is going to face stiff questioning from members of the House Financial Services Committee and the members of Senate Banking Committee.

For mortgage investors, the primary focus will be on what Bernanke has to say about future "quantitative easing" efforts directed specifically at the mortgage market. Mr. Bernanke will likely tell Congress the Fed has no plans at this time to expand their $1.25 trillion direct mortgage-backed security purchase program. Not only will he indicate there are no plans to "up-the-ante" - he will likely inform congressional leaders that Fed staffers are busy modeling various methods the central bank might use to "unwind" its large mortgage portfolio in an effort to shrink their overall balance sheet and return to normal operations.

The Chairman will have to tread lightly here. If mortgage investors were to get the impression the Fed intends to morph from a major buyer of mortgage-backed securities (buying more than 80% of all issues so far this year) to a steady seller of those same securities -- the upward pressure on mortgage interest rates will be significant. The probabilities are high that Mr. Bernanke will simply say a number of options are under consideration - and significant additional study will be necessary before action is taken. He will likely stress that the economy in general, and the housing sector specifically, are still too weak to withstand higher borrowing costs at this time. If this assessment proves accurate, mortgage interest rates will likely trade within a very narrow range of their current levels.

Look for the majority of the "question-and-answer" period that will follow Mr. Bernanke's prepared text testimony to be taken up by committee members howling about the Fed's latest updated economic projections. Even though the figures show the current recession won't likely be as deep as feared earlier in 2009, and the recovery next year may actually be stronger than expected, Fed research shows unemployment has the potential to top the psychologically significant 10% mark before the year is over, with little additional improvement anticipated in 2010. It will be the labor story that congressional delegates will focus on - and not particularly for the altruistic reason you might initially expect. Just so you can put all the chatter in perspective - know that the entire House of Representatives and one-third of the Senate faces reelection next year. You can bet lawmakers are well aware that unemployment breeds angry voters -- so the congressional squawking and blame-laying surrounding the employment issue, especially when the media focus is highest, will likely be deafening.

Friday, July 17, 2009

It is another lethargic, thinly traded day in the mortgage market. Surprising strength in this morning's June housing starts and building permits report was enough to give the sellers the edge as the day gets underway.

The Commerce Department said housing starts climbed 3.6% last month - driven higher by a solid 14.4% gain in single-family home construction with more modest gains in the multi-family category. The June gain in single-family home building is the largest monthly advance since December 2004 and the first time since February-March 2007 that single-family starts posted back-to-back monthly growth. June permits, an indicator of builder confidence, leapt 8.7% higher.

Most investors appear to be taking the June Housing Start and Building Permit report with the proverbial "grain-of-salt." While the latest data from the housing sector is encouraging - it is probably premature to declare a bottom for home builders has been established. This data series is subject to large and frequent revisions. Additionally, some of the recent surge in homebuilding may be a timing "thing" - builders racing to get pre-sold units on the ground before the December 1^st expiration of the federal homebuyer tax credit.

Looking ahead to next week, the economic calendar offers little in the way of data that will likely influence the direction of mortgage interest rates one way or the other. Monday's Leading Economic Indicators report (10:00 a.m. ET) will likely draw little more than a disinterested yawn from market participants. Thursday's (8:30 a.m. ET) initial jobless claims data will probably be heavily discounted due to distortions created by the bankruptcy of major participants in the auto and related industries. The week will round out with the release of the June Existing Home Sales data on Thursday (10:00 a.m. ET). The June New Home Sales report will be released on the following Monday (10:00 a.m. ET). Both measures of home sales are expected to show some modest improvement - a condition that is already priced into the mortgage market.

The "wild card" of the week will be Fed Chairman Ben Bernanke's semiannual monetary policy testimony before the House Financial Services Committee on Tuesday (10:00 a.m. ET) and an encore performance before the Senate Banking committee on Wednesday (10:00 a.m. ET).

If Mr. Bernanke talks of "bottoms" and the declining need for additional economic stimulus from Congress -- and/or reductions in "quantitative-easing" efforts by the Fed -- expect mortgage interest rates to edge fractionally higher. If, on the other hand, the Fed Chairman expresses concerns about a protracted or "double-dip" recession with the likelihood of joblessness exceeding 10% of the available workforce for an extended period of time -- expect capital to flow from riskier asset classes into the relative safe haven of Treasury obligations and mortgage-backed securities. Such a scenario, should it develop, will almost certainly be supportive of steady to perhaps fractionally lower mortgage interest rates.

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Thursday, July 16, 2009

The mortgage market is finding some interest rate friendly support this morning from news commercial lender CIT Group said talks with the government regarding a possible federal bailout have ended unsuccessfully.

The likelihood of another headline bank failure sent many stock investors scurrying for the relative safety of the Treasury and mortgage-backed securities markets. The fact that the government walked away from CIT's request for aid suggests officials believe the financial system is now strong enough to withstand the bankruptcy of not only CIT Group - but the "ripple-effect" financial failures that will occur in both the banking and business sectors.

Keep your fingers crossed Treasury Secretary Geithner, his bureaucratic entourage and the Obama administration in general are proven right on this one. If the financial system were to lock-up again following a notable bank failure -- the remedies would likely be more painful this time around. Sure, against such a backdrop mortgage interest rates should move notably lower - but the law of unintended consequences would be extremely difficult to avoid. Borrowers need the confidence and the motivation - not to mention the necessary qualifying income - before ever deciding to cast a shadow in doorway of a mortgage originator. Another major meltdown in the financial system would likely generate such high levels of domestic -- as well as global economic dislocations -- lower mortgage interest rates on your rate sheets would probably have little, if any real relevance in terms of sharply improved loan demand.

The Labor Department reported this morning the number of workers filing first-time claims for jobless benefits fell sharply last week -- to the lowest level since January. Initial jobless claims plummeted by 47,000 during the week ended July 11^th.

Normally such a big improvement in the labor sector would result in a sell-off in the mortgage market. This time around mortgage investors completely shrugged the number off. A Labor Department spokesman said there were far fewer layoffs than anticipated based on past experience in the automotive sector and elsewhere in manufacturing which accounted for the large drop. July is typically when the auto industry temporarily shuts plants for new model year retooling. The bankruptcy filing for both Chrysler and General Motors earlier this year pushed forward some of these shutdowns - putting autoworkers on the jobless rolls sooner than in previous summers. This was the second week in a row that seasonal factors had affected the data and the official said this data distortion would likely continue through the end of the month of July.

For the balance of the week look for mortgage interest rates to take their directional cues from trading action in the stock markets. Strongly higher stock prices will tend to drag mortgage interest rates higher - while relatively steady to lower stock prices will have a propensity to support steady to fractionally lower mortgage rates.

Wednesday, July 15, 2009

FOR THOSE OF YOU THAT MISSED ME - I APOLOGIZE - I WAS OUT OF TOWN ON BUSINESS/PLEASURE IN THE INNER BANKS AND OUTER BANKS OF NORTH CAROLINA. BUT I AM BACK SO I HOPED YOU HAVE SURVIVED THIS MORTGAGE MARKET SO FAR...

It is another "dog day" in the mortgage market - featuring thin, listless trading activity. Mortgage interest rates are drifting incrementally higher, driven by slightly stronger-than-expected economic news and improved buying interests in the stock markets.

The mortgage market staggered out of the gate this morning when the Labor Department reported consumer prices rose at a slightly faster-than-expected 0.7% pace in June, although most of the increase was due to soaring gasoline prices. The core measure of consumer inflation remained relatively tame. Some mortgage investors were unnerved when the Labor Department pointed out the June increase in the overall consumer price index was the largest since July 2008. If these same nervous-ninnies would have taken the time to read just a little bit further they would have been largely comforted by the fact that most of the headline gain was created by a 17.3% surge in energy prices - the sharpest month-over-month gain since September 2005. (Currently, gasoline pump prices are roughly 10% lower than the June highs.) Compared to the same period last year, consumer prices fell 1.4%, their biggest year-over-year decline since January 1950 - when prices fell 2.1% y-o-y. Just for the record, pump prices are currently 34.6% lower than they were in June of last year.

The more important core consumer price index, a measure that strips out the volatile food and energy components, rose 0.2% in June, slightly more than the 0.1% gain most analysts were expecting. Core prices compared with a year ago rose 1.7%, the smallest year-over-year gain on record since a matching gain in January.

The "so what" factor behind all this economic mumbo-jumbo is significant - the modest year-over-year gain in the core rate of consumer inflation clearly shows that last year's deflation fears should now be completely over - and there is little chance the economy will overheat in the coming months, especially with consumers likely to remain very frugal, spending only on household essentials. You can "take-it-to-the-bank" that today's sell-off in the mortgage market is probably not being driven by concerns the inflation beast will soon be waking from its slumber and raising its ugly head.

Separately this morning, the Federal Reserve reported industrial production fell in June at the slowest pace in eight months, adding to signs the worst of recession is probably behind us. The 0.4% decrease in output at factories, mines, and utilities was smaller than forecast -- and followed a 1.2% drop in May. Capacity Utilization, which measures the proportion of plants in use, dropped to a new record low of 68.0%. That's another bit of good news on the inflationary front - low utilization rates reduce or eliminate the risk of bottlenecks developing in the production cycle - a condition that many times forces prices of manufactured goods higher.

Diane Swonk, chief economist at Mesirow Financial summed up the current macro-economic environment best when she said, "What we're seeing is the absence of negatives rather than the emergence of positives." In many judgment it is the growing "absence of negatives" that is inducing an increasing number of mortgage investors to take their profits off-of-the-table and move into a defensive position with respect to their pipeline risks as they wait to see if the current "green shots" developing in the economy will grow or fade in the heat of the summer.

On another note (not intended to be a play on words) the Mortgage Bankers of America said its seasonally adjusted index of mortgage applications, which includes both purchase and refinance loans, increased 4.3% during the week ended July 10^th. Purchase applications fell 9.4% from prior week levels while refinance application increased 17.7%

Wednesday, July 1, 2009

Mortgage investors are slogging through another day of relatively thin, indecisive trading action. The day's economic data was at best a "mixed-bag" - and did nothing to clarify likely mortgage interest rate direction.

On the mortgage market friendly side of the ledger the private ADP employment report showed notably weaker payroll growth in June than most observers had expected. Joining the ADP report in support of steady to fractionally lower rates was the Mortgage Bankers of America report indicating their seasonally adjusted index of mortgage applications, including requests for refinancing as well as purchase money, dropped 18.8% during the week ended November 21, 2008 as consumers' job concerns, inability to sell existing homes, and appraisal issues took a toll on loan demand.

In the convoluted world of mortgage interest rates these two reports are both considered to be signs of economic weakness - and therefore supportive of the prospects for steady to fractionally lower mortgage interest rates.

Offsetting the mortgage interest rate friendly ADP and MBA reports was data from the Institute of Supply Management showing conditions in the manufacturing sector continued to improve noticeably in June. The ISM's factory activity index rose to 44.8 last month, its highest level since August -- while the production index climbed to 52.5, it highest level since September. The overall strength in the ISM index is leading most analysts to conclude the worst of the recession is over in the manufacturing sector.

The National Association of Realtors chimed in this morning with a report showing the number of Americans signing contracts to buy previously owned home rose in May for the fourth consecutive month -- while global outplacement consultants Challenger, Gray & Christmas said planned job cuts by corporate America are down 33% from May levels. Last but not lest traders are anxiously waiting this morning's announcement from the Treasury Department regarding the size of next Tuesday's 3-year note auction, Wednesday's 10-year note auction and Thursday's 30-year bond offering.

Tomorrow's morning's 8:30 a.m. ET release of the June nonfarm payroll figures remains the dominant event of the week. Investors have already priced in expectations the number of jobs lost in June will match or exceed the consensus estimate of 355,000. The national jobless rate is projected to ratchet up to 9.6% and that view is also reflected in current prices. All will be well in the mortgage market as long as the actual numbers match or show an even worse picture of the labor sector than investors have already cranked in to their pricing models. That is one side of a two sided coin.

The other possibility is that the actual numbers show a labor sector stronger than the majority of market participants anticipated. If that's the case, Thursday's payroll data will immediately light a very short fuse on a very powerful firecracker - resulting in a mad scramble by investors to get out of the way before they get financially singed by the "hot" economic news. Such a condition, should it develop, almost always results in higher mortgage interest rates.

Tuesday, June 30, 2009

Today marks the end of the second-quarter and the first-half of 2009. It is a time when market participants will be busy making last minute adjustments to their portfolios before the books are closed - and the commission calculations for traders begin. Trading action will likely be a little bizarre today as some market participants execute trades to do nothing other than to spiff up numbers that may otherwise not be that spiffy.

This "window dressing" phenomenon in large part explains why so many analysts were barking at the moon immediately following the reach of the second tier Standard & Poor's/ Case Shiller home price index for April. The index showed home prices in 20 metropolitan areas fell 18.1% on an annualized basis. The annualized index slumped 18.7% in March. The measure declined by 19% in January, marking its largest monthly swoon since records began in 2001. I don't know about you, but it sure looks to me to be very premature to begin dancing in the streets declaring the slump in the residential real estate market has bottomed simply because the pace of decline in home values improved almost imperceptibly for their recent all-time lows. Home values will improve as the employment picture improves. With most economists still projecting the national jobless rate will reach 10% yet this year -- the prospects for a near-term sustained advance in home values will likely remain dim.

Speaking of employment - Thursday's release of the June nonfarm payroll figures remains the dominant event of the week. Investors have already priced in expectations the number of jobs lost in June will match or exceed the consensus estimate of 355,000. The national jobless rate is projected to ratchet up to 9.6% and that view is also reflected in current prices. All will be well in the mortgage market as long as the actual numbers match or show an even worse picture of the labor sector than investors have already cranked in to their pricing models. That is one side of a two sided coin.

The other possibility is that the actual numbers show a labor sector stronger than the majority of market participants anticipated. If that's the case, Thursday's payroll data will immediately light a very short fuse on a very powerful firecracker - resulting in a mad scramble by investors to get out of the way before they get financially singed by the "hot" economic news. Such a condition, should it develop, almost always results in higher mortgage interest rates.

As I mentioned in this space yesterday trading action in the stock markets will be the "wild card" in all of this. I see reasons to believe the Dow (target bottom 8350 to 8250) and NASDAQ (target 1810 or so) are becoming increasingly vulnerable to a multi-day downside price correction. Should such an event occur, capital fleeing falling stock prices will tend to flow to the relative safe haven of Treasury obligations and mortgage-backed securities. This so called "flight-to-quality" is generally supportive of steady to fractionally lower mortgage interest rates. From a timing perspective - I think the chances are good the stock markets will put in a multi-day price high on, or before July 8^th.