prosaic
pro-ZAY-ik
1. Dull; unimaginative.
2. Everyday; straightforward; ordinary.
3. Having the character of prose as compared to the
feeling of poetry.
From Latin prosa (prose), from prosa oratio
(straightforward speech), from provertere (to turn forward).
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TIP OF THE WEEK
The prosaic proliferating promulgations in the new SOP
50-10-6 (SOP is an acronym for Standard Operating Procedures) has a credit
elsewhere test.
Although a personal resources test was rescinded by CARES
Act as of March 27, 2020, lenders are still required to determine that some or
all of the loan is not available from the liquidity of the applicant or its
owners.
Lenders may want to use the rescinded personal resources
test as a means of determining availability of liquidity.
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Indices:
PRIME RATE= 3.25%
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SBA 504 Loan Debenture Rate for November For 20 year
debentures, the debenture rate is only 1.05% but note rate is 1.07% and the
effective yield is 2.364%.
For 25 year debentures, the debenture rate is only 1.14%
but note rate is 1.15% and the effective yield is 2.399%.
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AHEAD OF THE YIELD CURVE
A protean Federal Reserve released a prosaic statement on
monetary policy virtually repeating the text of its September statement.
Reflecting a procellous prolepsis they said that economic
activity and employment "continued to recover", which is less upbeat
perhaps versus "have picked up" in their September statement.
Keep your eyes and ears open for this week’s auction of
30 year Treasury bonds. At last month’s
auction, results were soft with the high yield at 1.578%.
Here is what the 30 year Treasury bond has been doing and
this week’s interesting little table:
2006- 4.91
2007- 4.84
2008- 4.18
2009- 3.89
2010- 4.61
2011- 2.89
2012- 2.77
2013- 3.25
2014- 3.97
2015- 2.91
2016- 2.32
2017- 3.16
2018- 3.13
2019- 2.594
2020- 1.216
What does all this mean?
I don’t know.
The recent rise in yields has prevented indigestion
associated with new issuance, but investors say Treasuries may need to cheapen
further to whet the appetite of bond buyers ahead of rising federal budget
deficits.
The auction amount has increased over 30% to $27 billion
due to higher borrowing needs. Last
month’s auction was $23 billion.
It is a propitious time for prospicient borrowers.
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OFF BASE
Author F. Scott Fitzgerald was never prosaic. One of his quotes is perhaps appropriate for
these times:
“The test of a first-rate intelligence is the ability to
hold two opposed ideas in mind at the same time and still retain the ability to
function.”
If you are having trouble functioning right now, go ahead
and take Wednesday off. It’s a holiday.
The Federal Reserve has promulgated that these are our
remaining holidays for 2020:
Veterans Day November 11
Thanksgiving Day November 26
Christmas Day December 25
We can’t quite yet prorogue 2020.
