Before we move into the financial data, I thought it was interesting to have a look at what the idiom, “read the tea leaves” means.
According to this piece, “Reading the tea leaves” comes from tasseography, which is the practice of telling someone\’s fortune by “reading” a splotched or smeared substance. In the Middle Ages, self-proclaimed clairvoyants would use melted wax or molten metals for the process, but after the tea trade exploded in the 17th century, these leaves from the Far East became the magic material of choice for this Western tradition (coffee is also popular).
The process varies by psychic, but it usually goes something like this: Un-strained tea is poured into a cup or container. The subject then drinks or dumps the liquid out. What remains is a bunch of soggy tea stuck to the sides and bottom of the cup, which is then interpreted by the reader as either a series of symbols or the outlines of pertinent imagery. See an acorn? That could mean you have good health in your future. A sword? You may be thrust into an argument soon. A 90-foot-tall talking water buffalo? You weren\’t drinking normal tea, my friend.
With that in mind, it\’s good to remember that reading financial news with hopes of predicting the future of markets is an inexact science.
According to this Bloomberg article, “The 30-year average sunk throughout 2020 and reached a record low of 2.65% at the beginning of this year. It has climbed since then, tracking yields for 10-year Treasuries, which have been above 1% since January.
The Federal Reserve is widely expected to start scaling back its monthly bond purchases in coming months, a move that may gradually push up mortgage rates. Sustained inflation and a pickup in economic activity may also help drive rates up, according to Greg McBride, chief financial analyst at Bankrate.com. Still, rates have been below 3% since July and it\’s unclear when they\’ll move above that level.
“Whether that happens next month or six months from now is very hard to say,” he said. “I\’m surprised they\’ve stayed this low for this long.”
What does this mean to those of us in or affected by the housing markets?
Overall, as I shared last month, we seem to be moving through a period of slightly calmer waters with housing inventories rising a little in many markets and rates remaining very low.
One thing I know for sure is that investing time and energy in nurturing relationships with our valuable clients can help us smooth out any bumps that lie ahead. As we enter autumn, I\’d love to schedule time to discuss how we can do exactly that!
Please drop me an email or call if you have any questions – or someone you know is in need of expert advice. I love to help those you care about. If you have a referral please click the button down below. Your referrals are the heart and lifeblood of my business.
Mission San Jose Mortgage
2111 W. March Lane, Suite B100
Stockton, CA 95207