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-- -- -- afternoon -- a -- and pending home sales in May actually because they surged to the -- level in more than six years.
Are people jumping in the housing market because mortgage rates are on the rise want to bring in Raymond James chief economist Scott Brown to talk about that.
But also talk about how you can make some money in what.
Could still be a down month for June on the Dow let's talk about housing first you believe that people of misinterpreted.
The forward guidance from the Fed in fact one of your -- actually said that investors of often confuse the Fed's stated quantitative thresholds.
In English if I want to buy -- house is now the time to do it -- -- I have time to wait.
I think it's an excellent time to to buy -- home you're seeing home prices improving and in most areas of the country.
Mortgage rates even though they're higher still very very low by historical standards.
I think we've definitely turned the corner there the one thing we do really need to see.
To sort of a -- that longer term trend and recovery in the housing sector is improvement in the job market and we're adding.
You know enough jobs.
Over the the last several months you know just to support that but we really want to see -- much better gains in the months ahead.
And well here's why enjoyed reading your research notes because wet when mr.
Bernanke made his comments and everyone was freaking and we saw the sell off.
What it -- people missed was the revision to have future GDP for 2013 which actually now I'm saying will be worse.
Than first thought which a lot of people who got it right I think said.
No slowing down on you know monetary policy but even if they slow down it's not a tightening explain to me why this market overreacted to the Fed.
Well I'm not it's not.
Clear why the market overreacted I thought -- -- term Bernanke was was crystal clear and in his press briefing and you know.
Though the videos right there on the on the Fed's website you can view the transcript go over and details.
There was really no change at all in monetary policy.
All the Fed Chairman was doing was explaining the Fed's decision process.
In this week you're seeing a lot of the Fed officials some of the district bank presidents and and maybe a couple of the governors now.
All going out and singing from the same page of the hymnal on -- all have the same message about.
-- of the Fed's monetary policy one is that you know there really wasn't any change in monetary policy last week.
-- this was the view all along.
Any sort of tapering -- in the months ahead is going to be data dependent.
-- economy starts to slow down bit weaker than expected.
That tightening -- that the tapering -- gets pushed out.
The second is that tape spring is not tightening even if the Fed slows the rate of asset purchases it's still going to be adding monetary policy accommodation Cisco let's talk about how important thing was -- long term rates not not really are are expected to rise threat really until 2000 -- Talk about how an average Joseph like myself for the people watching.
And make their decisions about investments we're watching what I think some people call irrational exuberance of the -- we could still have our first down month.
Even though were up today.
It's really about for instance revenue we're going to find out what's happening with companies.
In their second quarter earnings and are you optimistic that the revenue growth is going to be there to sustain future growth on the Dow or that to be 500.
Well I I think we're gonna see continued growth in in earnings.
I suspect it's gonna still be.
Based a lot more probably on cost containment rather than top line growth.
You're not really seeing much growth in the rest of the world right now that would be a problem -- that would that would signal a prologue to a lot -- things -- done for mercies.
Never got -- that as a problem but we we don't expect the global economy to stay weak forever so you know we we anticipated is gonna pick up.
Probably more and later this year in in in the next year but we don't see that being especially strong -- their earnings outlook may be a little bit Dicey in the near term.
But again there's that emphasis on cost containment still firms doing a lot more with the with the the same amount of people.
All right well Scott Brown chief economist from the Raymond James we appreciate you joining us here on the Fox Business Network markets now a good rest of this Thursday afternoon to you.
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