I chose this picture of Grizzly Adams as a representation of current market conditions for three reasons: 1. It was my favorite show (besides Dukes of Hazzard) when I was a kid. 2. My 12 year old son just did a report on the real James “Grizzly” Adams for 7th his Grade U.S. History class. 3. It seemed more workplace appropriate than a photo of a doped-up crack head. The metaphor of the crack head could have been used because A: the markets also make decisions based on irrational fears and B: the markets currently “need” low interest rates to get through the day. As a continuation and clarification of my commentary yesterday, I want to reiterate that we are not in a “normal” market. In a normal market, good news (whether economic or political in nature) leads to higher stock prices and higher interest rates, while bad news leads to lower stock prices and lower interest rates. Mortgage Bonds have seen reduced yields this last week as stock prices have plummeted over the anticipation of rising rates cutting into profitability. Thirty year rates for FHA are at 3.25% and conforming conventional loans are at 3.875% today, while 15 year rates are down at 3.0%. (APR will be higher, depending on the amortization term, and the loan and down payment amounts–as closing costs and the presence of mortgage insurance affect each loan differently).