To use the mind: to think, reason.
Back-formation from cerebration (act of thinking), from cerebrum (brain).
TIP OF THE WEEK
TIP OF THE WEEK
Here is something to cerebrate over.
The latest FDIC Quarterly Banking Profile indicates that total loans and leases are up 5.3%.
SBA 7(a) lending was up 13% for the quarter ending 12/31/2016.
That’s good news for the economy.
Just for fun I calculated the correlation coefficient between SBA 7(a) loan volume and GDP for over six years using the Microsoft CORREL function. It came out to a statistically significant 0.86.
Financial results for the fourth quarter of 2016 are included in the FDIC's latest Quarterly Banking Profile. Let me know if you would like a copy of the latest FDIC Quarterly Banking Profile.
SBA has changed SBA form 2462 the franchise addendum. The SBA Addendum now includes a drop down box and the language regarding termination of the SBA Addendum has been clarified.
Make sure you have the latest version of this addendum now required for ALL franchise loans unless the franchisor has an SBA Negotiated Addendum with a 2015 or 2016 date. If you have a negotiated addendum you can then use SBA form 2463 the franchisor certification.
PRIME RATE= 3.75%
SBA LIBOR Base Rate March 2017 =3.81%
SBA Fixed Base Rate March 2017 = 6.07%
SBA 504 Loan Debenture Rate for February
The debenture rate is only 2.82% but note rate is 2.868% and the effective yield is 4.607%.
AHEAD OF THE YIELD CURVE
AHEAD OF THE YIELD CURVE
Some cerebration is necessary amongst the splentic presentiment on the economy and interest rates.
According to the
Sentiment Index has been higher during the past three months than anytime since
March 2004. The gain represents the result of an unprecedented partisan
divergence, with Democrats expecting recession and Republicans expecting robust
growth. While the expectations of Democrats and Republicans largely offset each
other, the overall gain in the Expectations Index was due to self-identified
Independents, who were much closer to the optimism of the Republicans than the
pessimism of the Democrats. University of
So Democrats are expecting recession and Republicans are expecting robust growth.
What does the Federal Reserve think?
Bond traders are now pricing in odds above 75 percent that Federal Reserve policy makers will raise interest rates when they meet in two weeks, but there is still plenty of data to chew on before then.
On Friday, the Labor Department will release its report on jobs for the month of February. While the Fed does not respond to just one report, they would like to see something trend-like to support a hike. The labor market began 2017 on a high note as U.S employers added 227,000 jobs in January. This was the most in four months.
Keep your eyes and ears open for Thursday’s auction of 30 year Treasury bonds. Results were quite solid for last month's 30-year bond auction with the yield at 3.005 percent, 9.1 basis points above the January auction yield and 83.3 basis points higher than the 2016 July auction low. The 30-year yield has increased by about 15 basis points over the past week.
Eurodollar futures settle at a three- month lending rate that has averaged about 22 basis points more than the Fed's target over the past 10 years.
Here is a summary of what the market expects for Eurodollar futures based upon the pit-traded prices at the Chicago Mercantile Exchange:
What does all this mean?
I don’t know.
Eurodollar futures imply a quiescent Federal Reserve will not estivate.
Next week begins with Daylight Saving Time. It ends with Saint Patrick Day on Friday.
The first day of Spring follows on Monday.
It sounds like there should be a holiday somewhere in there as our next holiday recognized by the Federal Reserve is not for another two and a half months!
This is longest break in bank holidays of the year.
According to the Federal Reserve, here are our remaining holidays for 2017:
Memorial Day May 29
Independence Day July 4
Labor Day September 4
Columbus Day October 9
Veterans Day November 11
Thanksgiving Day November 23Christmas Day December 25