Jobs and Disaster Recovery
With the release of last month’s job numbers, we were able to get a glimpse of the major effects of three major hurricanes hitting within a few weeks. We have seen many pictures of devastation from Texas to Puerto Rico. The jobs report was one more picture which has made the national numbers look bad, even considering the drop in the national unemployment rate, but the national numbers still dwarf the drastic effects upon the local economies and millions of lives.
This story will not be a short story. It will be a novel with many chapters. It starts with mass devastation and the delivery of food and water, as well as other supplies of survival. It will end differently for many. Some will relocate and many others will be part of the rebuilding process. That rebuilding process will create thousands upon thousands of jobs. This is likely to result in construction job shortages in other parts of the country.
How long will it take to recover? No one knows the answer to that question. Many economic reports will be skewed as these regions go through the process. Even the federal budget deficits will be affected by a slowing economy and increased funds spent on recovery efforts. Along with the budget deficits, there will be a spike in mortgage defaults. But again, the housing stock will be rebuilt. For market analysts, this will be a very interesting story, but not nearly as meaningful as those affected locally.
The Weekly Market Update
Rates edged up in the past week, with rates on home loans rising less than Treasuries. For the week ending October 5, Freddie Mac announced that 30-year fixed rates rose to 3.85% from 3.83% the week before. The average for 15-year loans rose 2 ticks as well, to 3.15%. The average for five-year adjustables moved down to 3.18%. A year ago, 30-year fixed rates averaged 3.42%.
Attributed to Sean Becketti, chief economist, Freddie Mac — “After holding steady last week, rates ticked up this week. The 10-year Treasury yield rose 8 basis points, while 30-year fixed rates increased 2 basis points to 3.85 percent.”
Note: Rates indicated do not include fees and points and are provided for evidence of trends only. They should not be used for comparison purposes.