It’s Go Time for the US Economy Again!

by Tim Krulia – Private Money Blueprint CFO

As part of our quest here at PMBP to give you the single best resource on the financial aspects of growing your real estate investing business (aka, we help people find private money quickly, easily, and abundantly)… here are some stats I found that helps explain the economic recovery…

If you’ve been following my little weekly article updates the past few months, you’ve read about how I think we as an economy have past our worst days a while ago. The leading indicator is certainly in my mind still the unemployment rate but other contributing factors make me feel stronger and stronger that we’ve bottomed out and are on the up swing. Check out the stock markets:

http://www.nasdaq.com/aspx/chartingbasics.aspx?symbol=IXIC&selected=IXIC

New York Stock Exchange – Last 12 months:

http://www.nasdaq.com/aspx/chartingbasics.aspx?symbol=NYA&selected=NYA

Heck the Dow hasn’t been this high since before it started taking a dive before the 2008 presidential election.  Some say that you can look at the markets and they will tell you where the economy is headed six months or so in the future.  If that’s a good rule of thumb to go by, then we’re in for a good ride for the rest of the year!

Let’s take a peek into the mortgage market.  Interest rates for lending are incredibly low.  The average 30 year fixed conforming mortgage rate is averaging 5.14% this week.  Historically, they say that anything under 8% is good.  These rates are basically the same as back in the huge refinance boom in the early 2000’s.  These great rates may translate into lower interest payment requirements by your private money lenders too.  You could say, “Well, if the banks are only getting 5% for their borrowed funds and I can offer you 8%, that’s pretty good, isn’t it?”

Heck, there are little stories of hope and prosperity popping up all over the place now.  Here’s one that I though was pretty cool.  Florida, arguably one of the hardest hit states from the real estate bust is starting to show signs of rejuvenated real estate life.  Check out this video.

Comments spoken in the video by the builder’s executive includes:  
“Push of 1st time buyers & move up buyers,” “Picking up,” “People are coming down from other parts of the country again,” (meaning – they are seeing home buyers relocating to Florida again which they said hasn’t been the case since a few years ago), “Increased growth.”

Increased construction does translate to increased jobs and thus lower unemployment.  It also shows that there is new life getting breathed back into the real estate market right now!

Here’s our updated unemployment rate chart with March included.

As you can see, our actual rate is holding below the 270 moving average again this month and the Unemployment rate had another steady month holding at 9.7%.  It’s true it didn’t come down this past month vs. Feb. & Jan., but it didn’t increase either.  This marks 5 straight months without the unemployment rate increasing.  We haven’t had that happen since late 2006!  Any month now, let’s expect to see it start ticking downward.  We’re all hungry to read about real economic growth and just wait till the media gets smart to that fact.  They’ll start reporting all the good that’s sprouting in the economy and the avalanche will start!  Who wants to bet me on it?