Stalled Stimulus
Can the American recovery persist without government support? Today the market gave us a hint:
Heh, it didn’t even take actual removal of government intervention to sack mortgage applications, the MBA confirms today. As we noted earlier this week, the tax credit was extended and expanded into the spring of 2010. Just the anxiety of its Nov. 30 expiration alone (or perhaps savvy homebuyers waiting to see if they were going to get a better government deal) plunged the mortgage applications index to 220 last week, its lowest score since 2000.
And what a coincidence, too… the previous low was in early February of this year, right before our government enacted the homebuyer credit.
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