meiosis
my-O-sis
1. Understatement
for rhetorical effect.
2. The process of
cell division in which the number of chromosomes per cell is reduced to one
half.
From Greek meiosis
(lessening), from meioun (to lessen), from meion (less).
_______________________________________________
TIP OF THE WEEK
SBA loans are
OK.
_____________________________________
Indices:
PRIME RATE= 3.25%
SBA
LIBOR Base Rate May 2013 = 3.20%
SBA
Fixed Base Rate May 2013 = 4.52%
________________________________________
Debenture
Rate for May
The
debenture rate is 2.07% but note rate is 2.107% and effective yield is only
4.15%.
________________________________________________
AHEAD
OF THE YIELD CURVE
This
month’s Treasury auction of 30 year bonds went off at a yield of only 2.98%, the
lowest yield since December.
April’s
auction had a yield of 2.998% compared to March’s 3.248%, the highest in a year.
A
factor in the favor of buyers of 30-year bonds--inflation fears, the biggest
threat to the 30-year bond's value over time, have pulled back over the past
month. Several gauges of inflation in the U.S.
released in recent weeks fell below the Fed's 2% target, and some bond bulls
believe falling inflation gives the Fed breathing
room.
The capacity
utilization rate, which measures how much plants and factories are being used,
is one of the Federal Reserve’s favorite gauges of the
economy. The Federal Reserve watches
capacity utilization rates to see if production constraints are threatening to
cause inflationary pressures. Bottlenecks or shortages often lead to
inflationary pressures that would drive prices even
higher. Several analysts have pointed
to a rate between 81% and 82% as a tipping point over which inflation is
spurred.
Last
week the Federal Reserve reported that capacity utilization fell to 77.8 percent
from 78.3 percent the prior month. This is only 0.1 percentage point above its
level of a year earlier.
Mild
inflation gives the Federal Reserve more latitude to continue with its
aggressive policies to spur greater economic growth. The Fed has said it plans
to keep the short-term interest rate it controls at a record low near zero until
the unemployment rate falls below 6.5%, provided inflation remains in
check.
So
where then are interest rates going?
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:
DEC13-
0.32
DEC14-
0.47
DEC15-
0.84
DEC16-
1.48
DEC17-
2.17
DEC18-
2.75
DEC19-
3.07
What
does all this mean?
I
don’t know.
It
would appear that interest rates are never ever going
up.
__________________________________________
OFF
BASE
A
three day weekend finally beckons.
After
three months without a holiday, Memorial Day is
here.
According
to the Federal Reserve, here are the remaining holidays for 2013:
Memorial
Day May 27
Independence
Day July 4
Labor
Day September 2
Columbus
Day October 14
Veterans
Day November 11
Thanksgiving
Day November 28
Christmas
Day December 25
