Now that the earnings bar has been set so low, this could present an opportunity for some wild swings in the market! The unprecedented action that the government has taken is just now starting to show signs of recovery. With the 30-year fixed mortgage rate seeming to hit new lows every week, this has created a surge in the bank’s loan pipelines from people wanting to refinance their homes. It will be interesting to see if they can handle the surge with understaffed departments after massive layoffs. The longer they can sustain the lower overhead, the greater the profit will be on the bottom line, but only time will tell which banks will start hiring more people to go after mortgage market share. I believe this will be the true sign to the start of a recovery. Decreasing unemployment and the banks showing signs of a recovery will surely be a sight for sore eyes. Housing data is looking extremely promising as well, with sales up and inventories shrinking. As long as earnings hit the mark or above, maybe with a few big profit surprises, things are starting to look promising!
TT
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