Spread Narrows For Bank
The bank holding company Commerce Bancorp Inc (CBH), is primarily in commercial RE lending. The firm reported that the difference between what it pays for deposits and what it can charge has narrowed. Investors didn't like it. "The difference between what Commerce earns on loans and pays on deposits, fell to 4.04 percent from 4.39 percent."
The company is still pushing it's growth. "The New Jersey-based company also said it plans in June to open its first branches in the Washington, D.C. metropolitan area, as part of an ambitious plan to open 200 branches in or near the nation's capital."
9 Comments:
It is about time that something in the financial arena made sense !
The FED rates are going up and mortgage rates are staying the same, more or less. Someone somewhere has to be getting squezzed. For a while it appeared as though money was free, investors didn't demand any returns.
I think this is just the start. Look for mortgage rates to move up by about 2% shortly.
Help, my house isn't selling !
http://money.cnn.com/2005/04/12/real_estate/homeguide_notselling/index.htm
i live in new jersey... and home prices have been coming down... some have even been reduced 2 or 3 times... and it's spring... what's going to happen in the fall?
Fed doesn't pop bubbles
http://www.prudentbear.com/randomwalk.asp
(The slowdown has really been only the past couple weeks, but quite dramatic)
Thank you Deb, you are really helping all of us understand what is going on..Ben
"Fed doesn't pop bubbles"
Thanks for the link. The best quote in that article:
"Besides, the Fed not taking responsibility for asset bubbles is like an animal trainer who won’t take responsibility for what happens to the wait staff when he takes his tiger to a vegetarian restaurant. Who do they think is blowing up these bubbles, a desperate Farah Fawcett?"
Banks are in a Lose Lose Situation
If long rates go down their spreads narrow.
If long rates rise their bond prices drop.
The FRB cannot help out because they have to give some consideration to inflation.
With real interest rates right about at par, they can't risk lowering them without a collapse in the dollar. If the dollar collapses then all hell will break loose - and they know it. They have to protect the dollar because they are beholden to foriegners to finance the government. If you want to know who controls US interest rates then look to the Japanese or Chinese central banks not the FRB.
Bank stocks are going down. And that's about the surest bet one can make right now.
I'm just waiting for a hedge fund to blow up. It's only a matter of time...
My largest position is cash. After that, it's short US stocks.
(I'm just waiting for a hedge fund to blow up. It's only a matter of time)
Almost certainly, hedge funds will/are play a role in the bust.
This is just another example of the housing market in Las Vegas (http://www.lasvegashomes.com/Default.cfm/Page=/ListingsReduced.html):
04/11/2005: 15921 single house listing
04/12/2005: 16110 single house listing
04/13/2005: 16292 single house listing
What's next???
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