Mortgage Rate Increases Lead to Near-Term Sales Spike… Wait, What? (CNBC)
With mortgage rates soaring a full point in the last two months, and most people anticipating further increases, you’d think a downward trend in that market would be starting. And you would be wrong, according to Doug Duncan, chief economic strategist at Fannie Mae. He thinks we could see a little more urgency in housing purchases for the near term. He bases his opinion on the most recent findings prepared by Fannie from its monthly survey of potential home buyers. Optimism peaked in May, but since then, mortgage rates have risen a full point. And 57 percent of those surveyed think they’ll go higher. For Duncan, that means a near-term spike in purchases. “That spike in mortgage rate expectations… may increase housing activity in the near term by driving urgency to buy…” Now we’ll just have to see if investors have the same opinion.
Apple’s 20 Percent Cut Bad Omen for Approaching Earnings (YahooFinance)
Reports from supply-chain companies in China and Taiwan that produce Apple iPhone components indicate a 20 percent reduction in orders through the year’s end, according to Brian Blair of Wedge Partners. Apple recently reported that it now expects to move 90-100 million iPhones through year’s end, down from its original estimate of around 115-120 million units. That’s certainly not the direction the world’s most recognized smartphone brand wants to be heading. And with share price closing at $415 and change yesterday, that represents a 43 percent drop from the company’s $700-plus peak. Is this the first of many similar shoes to drop as we head into earnings-reporting season for the second quarter of 2013?
The Death of Copper-Based Communications (Bloomberg)
In the wake of last year’s SuperStorm Sandy, residents along the Eastern seaboard of the United States have had a Sisyphusian struggle to rebuild their lives. And now, for residents of Fire Island in New York, the hill they’ve been pushing their boulders up has become even steeper… thanks to Verizon Communications. That’s because the telecom giant is asking federal authorities for approval to not replace the copper wire networks that have been the communications industry’s standard since 1934. Instead, the United States’ second largest carrier wants to replace copper cabling with its Voice Link fiber- and airwave-based systems. If the company’s request is approved, they’ll be ending the reign of copper for 10 million customers using traditional landlines. AT&T, the nation’s leading carrier, has made a similar request and will be watching this case intently, as will every copper investor on the planet.