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To see current market stories scroll down for up to the minute stories and news regarding the stock markets and the interest rate markets.  The following charts show the current Real Estate Trends for the Greater Sacramento Area.

Statistics are for the Greater Sacramento area including Sacramento, Yolo, Placer and Eldorado Counties

How Higher Priced Homes and Technology Killed Inflation:
It has long been the Federal Reserve's Policy to fight inflation by raising interest rates to slow consumers from spending too fast and causing inflation.  So you might ask why with housing prices rising to an almost unaffordable high that the Fed (the Federal Reserve) has not raised interest rates to combat such high housing prices.  Well, the answer might surprise you or it might just be so obvious that you slap your economic head and say wow that's right.  Inflation is a rise in prices of consumer goods and services over time given in a percentage of gain from month to month or year to year.  The rise in housing prices can and is quantified the same way, however, the big difference between goods and services and Housing prices is that consumers need the basics every month like food, consumer goods, and services from plumbers, electricians, etc., but consumers don't buy houses every month.  On average people stay in their housing for an average 5-7 years thus not being affected by housing prices until it is time to move.  In addition, when housing prices go up and people stay in their homes for an average of 5-7 years they end up realizing price gains on their existing home and this is called realized equity.  So when the prices of goods and services increase month to month consumers need the basic items to live so they will buy them realizing no equity as these items are consumed. 
     Household income plays a factor in inflation as well as the more money people make the more they tend to consume.  So if America on the average is making more money they will consume more creating a higher demand for goods and services thus prices will rise to offset the higher demand.  So why doesn't such high priced housing effect interest rates?  Simply put housing is not something consumed it is an asset that has trade value or equity.  In addition, people are not in need of purchasing housing every month or every year for that matter. 
     It has long been the Federal Reserve's policy to keep inflation around 2% and since the 1970's the Fed has done a great job of keeping in check.  However, I believe there are other factors in play the Fed is not taking into consideration.  I will say that the high priced housing has used up far more of the average household budget thus leaving consumers less money to buy goods and services with.  This may either be by design, but I would contend that it is actually a happy accident in the Fed's favor. If you are spending the majority of your income on your housing expenses that leaves you with less money to buy goods and services.  In addition to that technology is such a big part of today's world that people don't need or want for more personal items to keep them entertained or fulfilled thus lower demand for certain physical items.  It is tough to have inflation if the demand for things goes away and that is what technology has done.  An example are college kids these days. College kids need to eat, drink and study, but with their smartphones, they can get everything they need on that device delivered to their door and their entertainment is at their fingertips.   Technology has slowed the need or the demand for goods and services and by doing so has slowed inflation.  I hope this has enlightened you on how the markets work and how they change.  I will predict that we see some changes in the Federal Reserve's approach to fighting inflation by raising interest rates in the future with the onset of even newer technology advances.     

Current News Feeds:

Current Market News:
 
If US does not slow down, don"t expect 10-year yield to go down further: Pro
3/25/2019 2:22 PM
(Please visit the site to view this media)CNBC's "Power Lunch" team is joined by Sri Kumar, president of Sri-Kumar Global Strategies, and Jim Paulsen of Leuthold Group to discuss falling stocks and rates....(Read More
 
Never ignore the yield curve, says Citi Private Bank chief economist
3/25/2019 2:22 PM
(Please visit the site to view this media)Steve Wieting, Citi Private Bank, and Greg Ip, WSJ, join 'The Exchange' to discuss yield curve concerns weighing on the market and if the U.S.-China trade deal could see an impact from the Mueller investigation.
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ETF Spotlight: Yield curve concerns
3/25/2019 2:22 PM
(Please visit the site to view this media)CNBC's Mike Santoli takes a look at the yield curve inversion, which has sparked concerns of an impending recession....(read more)
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Here"s how the Mueller report might affect the US-China trade talks
3/25/2019 7:20 AM
(Please visit the site to view this media)CNBC's Kayla Tausche reports on how the China trade talks might be affected by the release of the Mueller report....(read more)
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Why the homebuilders rally is just heating up
3/22/2019 4:55 PM
(Please visit the site to view this media)The 'Options Actions' traders break down the activity in the housing sector....(read more)
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Loan officer explains his best tips for finding the best mortgage
3/22/2019 4:29 PM
(Please visit the site to view this media)CNBC's "Power Lunch" team and Diana Olick are joined by Matt Weaver, Cross Country Mortgage loan officer and vice president of sales, to discuss what home buyers best mortgage options are....(Read More
 
Fed is going to drive us into a recession, says Canaccord Genuity chief market strategist
3/22/2019 1:42 PM
(Please visit the site to view this media)Tony Dwyer, Canaccord Genuity chief equity strategist, calls into 'Fast Money Halftime Report' to discuss the mid-day markets amid concerns of an economic slowdown. He also shares his thoughts on the Fed's dovish call.
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Slow economic growth is not a shock, says CEO
3/22/2019 12:35 PM
(Please visit the site to view this media)Shannon Saccocia, Boston Private Wealth CIO, and Michael Farr, president and CEO of Farr, Miller and Washington, join CNBC's "Fast Money Halftime Report" to discuss the mid-day market amid concerns of a global slowdown.
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US and China continue negotiations on Trump, Xi meeting
3/22/2019 9:09 AM
(Please visit the site to view this media)Trade talks between China and the U.S. are expected to resume next week as the two sides continue negotiations by phone. CNBC's Kayla Tausche reports....(Read More
 
Brexit could be delayed until May 22 if parliament approves
3/22/2019 7:08 AM
(Please visit the site to view this media)The European Union is giving U.K. Prime Minister Theresa May more time to work out a Brexit deal. CNBC's Willem Marx reports....(read more)<...Read More