Category Archives: The Economy

Between a Rock and a Hard Place

Market Memo

August 2023 – By Kyle Rohrwasser

A little history before we jump in, many people use this saying in their everyday lives, but many don’t know the origin. It was the actual origin of the idiom that comes from Homer’s Odyssey. In Homer’s Odyssey, Odysseus must pass between Charybdis, a treacherous whirlpool, and Scylla, a horrid man-eating, cliff-dwelling monster.

Although not a monster, the Fed has found itself in a situation that has one long-term solution but the timing of it will be tricky. As stated in many previous articles, the Federal Reserve has raised rates dramatically over the last year and a half, moving from 0% to 5.25%. This was done in the face of record-breaking inflation over the last 40 years, hoping the economy would slow and drive prices down. We have seen inflation fall from a 9% high in June of last year to a 3% month-end July of 2023, still short of the Fed’s 2% goal. Everything leads to lower rates eventually, but the question is, can the Fed time it correctly?

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What’s Going on with the Housing Market?

Market Memo – Planning Article

July 2023 – By Tom Rueger, J.D., CFP®

After a run that saw mortgage rates drop to all-time lows and home prices soar to new highs, the U.S. housing market finally started slowing in late 2022. Real estate professionals worried about a housing recession and home prices seemed poised for a correction as mortgage rates moved higher. For the week ending July 6, mortgage rates hit 6.81%, the highest level for the year so far, Freddie Mac reported (CNN). In theory, when mortgage rates go up, home prices should fall since it raises the cost of homeownership, thereby reducing demand.

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