The Chicago 77
Comprehensive Chicago Real Estate Information

3 December 2009 – Mortgage Bonds opened the day down and have continued to trend lower to a day change of -25bps. Today has been a significant news day as Chairman Ben Bernanke of the Federal Reserve testified in front of a Senate committee considering his re-nomination. In other notable news, the monthly Jobs Report will be released tomorrow. Jobless claims have been estimated at around 457,000, far short of the 480,000 expected, but tomorrow will confirm whether those numbers are valid or not. While the downward trend of jobless claims is encouraging, most economists agree that the labor market is still contracting. In addition, labor productivity numbers showed an 8.1% increase in the 3Q – certainly a positive for the economy as employers continue to get as much out of their existing workforce as possible. The stock market has been relatively flat as the dollar continues to struggle and investors attempt to make predictions on holiday retail sales. Friday, as always, will be an important day for the mortgage and stock markets due to the weekend. Mortgage rates are still strong with 4.750% (4.799% apr) on the 30 year and 4.25% (4.334% apr) on the 15 year.

8 February 2010 – Utility customers will soon carry the weight of those that do not pay their bills. Last year a new state law was quietly passed allowing utility companies to pass along bad debt to those who do pay their bills. Until this year, gas and electric rates included a set amount reflecting the utility companies’ estimate of the costs they would incur from unpaid bills. If those costs exceeded the estimate, the utility absorbed the losses. If bad debt fell short of the estimate, the utility pocketed the benefit. Now, customers will pay more if bad debt exceeds the estimate and get a credit on their bills if losses fall short. This causes one to wonder how hard utilities will work to collect unpaid bills if they don’t bear the losses. Be prepared for your utility bills to keep rising.