propose
pruh-pohz
to make an offer or suggestion, especially of marriage.
to form or consider a purpose or design
from Latin proponere to display, propound, from pro-
before + ponere to put, place
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TIP OF THE WEEK
The proposed SBA 7(a) guarantee fees reflect a
substantial increase for loans greater than $1,000,001.
Effective October 1st the guarantee fee for loans of
$1,000,001 to $5,000,000 will be 3.5% of the guaranteed portion of the loan up
to and including $1,000,000, plus 3.75% of the guaranteed portion of the loan
over $1,000,000.
The guarantee fee for SSBCI guarantees remain at 2.5% for
guaranteed portions up to $2,500,000 plus 2.25% of the guaranteed portion over
that. The maximum SSBCI guarantee goes
up to $5,000,000.
It would be proficuous to know the distinctions.
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Indices:
PRIME RATE= 8.50%
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SBA 504 Loan Debenture Rate for September
For 20 year debentures, the debenture rate is only 4.45%
but note rate is 4.517% and the effective yield is 5.833%.
For 25 year debentures, the debenture rate is only 4.45%
but note rate is 4.499% and the effective yield is 5.765%.
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AHEAD OF THE YIELD CURVE
Prospicient prognostications proliferate with our
procurators of interest rates, the Federal Reserve.
The Fed’s next meeting on monetary policy concludes
September 18th.
30-Day Fed Fund futures pricing data have long been
relied upon to express the market’s views on the likelihood of changes in U.S.
monetary policy.
Here are the Futures Implied Fed Funds
Sep-30-2024
5.19000
Nov-29-2024
4.67500
Feb-28-2025
3.81500
May-30-2025
3.28500
Aug-29-2025
2.94500
Feb-27-2026
2.77000
Aug-31-2026
2.81500
What does all this mean?
I don't know.
The current fed funds target rate is 5.25% to 5.50%. Fed funds futures imply a target rate
probability of 55% for a ¼ percent drop in the target rate.
The long end of the yield curve prognosticates
inflationary expectations and ultimately market rate expectations.
Last week’s auction of 30 year treasury bonds the high
yield was 4.015 percent versus 4.314 percent a month ago.
This lower yield was despite a reduced offering of $22
billion compared to $25 billion a month ago.
Non-dealer bids accepted accounted for 84 percent of the
total, suggesting OK demand.
More procellous promulgations on the yield curve’s
continued inversion is profligate.
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OFF BASE
September 17th is the annual Mid-Autumn Moon Festival on
the Chinese calendar.
This is one of the first harvest festivals of the year.
Its history reaches back to the Tang Dynasty (618-907 AD).
The full moon rises at sunset around this date, allowing
farmers to harvest well into the evening. It takes place on the 15th day of the
8th month of the Chinese lunisolar calendar, when the moon is at its brightest
and fullest, coinciding with harvest.
In America, it is called the Harvest Super Moon, when the
moon is closest to the Earth, making it appear larger than normal. It is so
close that the moon will appear full for three straight nights. This year, that
takes place less than a week before the fall equinox on September 22.
The word “equinox” comes from Latin aequus, meaning
“equal,” and nox, ”night.” On the equinox, day and night are roughly equal in
length.
After the autumnal equinox, days become shorter than
nights as the Sun continues to rise later and nightfall arrives earlier. This
ends with the winter solstice, after which days start to grow longer once
again.
