Blog - Archive for January, 2011

Market Update from Catalyst Lending

January 25th, 2011

Keeping you updated on the market!
For the week of

January 24, 2011


MARKET RECAP

The economic news stumbled out of the gate this week when the Commerce Department reported that homebuilders began work on the second fewest number of homes in more than fifty years in 2010, breaking ground on only 587,600 homes. Of course, the first fewest was the year before, 2009, when they broke ground on 554,000 homes, so there was an improvement.

The news quickly regained its footing, though. Builders appear to be planning more projects in 2011, based on permits rising 16.7 percent in December to a seasonally adjusted annual rate of 635,000 units, the best pace since last March. Fannie Mae is even more optimistic. It expects overall starts to increase 17.3 percent and hit 710,000 units this year, with another 42 percent increase to 1.1 million units in 2012, followed by a 42 percent gain to 1.5 million units in 2013.

As for the existing home market, RE/MAX reported a 13.2 percent increase in December sales. More encouraging, crisis hotspots Arizona and Florida produced double-digit yearly gains, proving once again the ironclad law of economics – lower prices equal more demand. According to RE/MAX CEO Margaret Kelly, “December’s trends put the housing market in a strong position for growth as the home shopping season nears.”

The NAR corroborated RE/MAX’s bullish outlook with bullish data of its own. The NAR reported that existing house sales increased 12 percent to a 5.28-million annual rate in December. Moreover, the number of homes on the market dropped 4.2 percent to 3.56 million units. At the current sales pace, it would take 8.1 months to sell these houses compared with 9.5 months at the end of November. An eight-to-nine month supply is considered consistent with stable prices.

Stable prices have been the defining characteristic of the mortgage market so far in 2011. The prime 30-year fixed-rate loan has been holding around 5 percent, vacillating only a few basis points in either direction. However, rates could be pressured higher if China continues to sell US government debt, particularly 10-year Treasury notes. Mortgage rates aren’t directly tied to 10-year Treasury notes, but these instruments hold tremendous sway over the direction of long-term debt instruments, including mortgage-backed securities.

Therefore, it’s worth repeating that although mortgage rates are off November’s lows, they’re still historically low. We doubt lower rates are in our future, and we are unsure how long price stability will last. At this point, we simply cannot offer any sound economic reason for people to wait on a refinance or a home purchase.

Economic
Indicator
Release
Date and Time
Consensus
Estimate
Analysis
Case-Shiller Home Price Index
(November)
Tues., Jan. 25,
9:00 am, et

0.4% (Decrease)

Important. Data released from other sources suggest the consensus estimate is low.
Mortgage Applications Wed., Jan 26,
7:00 am, et

None

Important. Stable rates are reviving refinance activity.
New Home Sales
(December)
Wed., Jan 26,
10:00 am, et

285,000 (Annualized)

Important. Excessive inventory continues to weigh on sales.
Federal Reserve FOMC Meeting Wed., Jan 26,
2:15 pm , et

Federal Funds Rate: 0.0% to 0.25%

Important. The Fed will hold the fed funds rate low, but a few board members are considering raising it.
Pending Home Sales Index
(December)
Thurs., Jan 27,
10:30 am , et

89 Index

Important. The index suggests an uptrend is waiting in 2011 home sales.
Gross Domestic Product
(4th Quarter 2010.)
Fri. Jan. 28,
8:30 am , et
3.5% (Annualized Increase)
Important. Economic growth appears to have accelerated in the closing months of 2010.
The Economy is More Than the Consumer.

Economists expend a lot of time and energy analyzing the consumer. It’s understandable, given that personal consumption represents 70 percent of gross domestic product. However, GDP only measures the value of final output. It deliberately leaves out a big chunk of the economy – namely intermediate production or goods-in-process at the commodity, manufacturing, and wholesale stages.

A more thorough accounting of total spending at all stages actually doubles GDP. By this measure, the consumer represents only 30 percent of the economy, while business investment (including intermediate output) represents over 50 percent. In other words, businesses stimulate the economy as much, if not more so, than consumers.

Businesses make decisions based on two factors: current consumption and expected future consumption. We often forget the latter, which businesses gear up for by purchasing commodities, capital equipment and workers’ services ahead of consumer sales. Therefore, while consumer spending might lag at the time, that doesn’t mean the economy is lagging too. The good news is that business spending has been strong over the past few months, which we think portends better things for 2011.

 

 

Luxury in Morocco

January 19th, 2011

In Morocco this week at Jardin Majorelle Yves Saint Laurent Expo and researched this article on his residence here.

Yves Saint Laurent’s house in Morocco up for sale

August 18, 2009 – Morocco

Yves Saint Laurent villa tangier

The Tangier, Morocco, cliffside home of the late fashion designer Yves Saint Laurent is up for sale. Yves Saint Laurent and his partner Pierre Bergé purchased the property in 1998.

Now Christie’s Great Estates have announced that Marrakech broker Majorelle Investissement is offering the house for sale with an undisclosed asking price.

Villa Mabrouka

The 9,700 square feet home, Villa Mabrouka (House of Luck) is in a superb cliffside position overlooking the Straits of Gibraltar.

Villa Mabrouka is approached through a courtyard garden that opens into an entrance hall with arcades and black and white checkerboard floor tiles.

Yves Saint Laurent villa tangier

Beautiful gardens designed by Madison Cox surround the main house, which opens through a Moorish-style entry flowing into a lobby with white Moroccan arcades.

Cox laid out the garden with towering palms, citrus and rolling lawns to emphasise the unfettered view across the sea.

Yves Saint Laurent villa morocco

The pool was carved out of a large rock and has an adjacent red stucco pavilion by American architect Stuart Church.

The interior design was by the legendary designer Jacques Grange. It was based on the house of an eccentric Englishman who moved to Tangier in the 1950s,’ says Grange.

There are a couple of sitting rooms in the house including the Blue Room which is all done up in blue chintz and the Yellow Room in, surprise, yellow chintz.

Yves Saint Laurent villa morocco

Other public rooms include a dining room with bamboo walls, and office and a library that, according to listing information, exudes an English club atmosphere and a Colonial era fireplace.

There are, according to listing information, three bedrooms on the main level including two master bedrooms with verandas and private poopers as well as a third bedroom that also includes a private pooper.

Villa Mabrouka

There are two additional bedrooms that share a bathroom on the garden level where the professionally equipped kitchen is located.

Christie’s also says it will offer a second sale from the art collection of Saint Laurent and Berge with auction house Pierre Berge and Associates on Nov. 17, 18 and 19 in Paris.

Sources: Realestalker Riadzany

Yves Saint Laurent

Rent Price Jump

January 14th, 2011

Rent Prices Jump 11.6% in 2010, Home Prices Slide 9.8%

Washington, DC. – January 6, 2011 – Rental prices across the US increased 11.6% in 2010, growing from a national average of $1181 in January 2010 to $1319 by December. The steady increase in rental prices was inversely matched by falling prices of homes for sale, which saw a 9.8% drop over the same period.

The rental price increase is a factor of uncertainty in the US economic climate, which has forced a transition from a home buying mentality to one more in favor of renting. The growing number of homes lost to foreclosure in 2010 expanded the number of people seeking to rent, creating a renter surplus.

Further, with the US unemployment rate over 9% throughout 2010 (up from 4% in 2006), low risk housing options became more desirable, a trend which may continue in the coming months.

At the same time, HotPads expects to see foreclosed and long standing for sale properties re-enter the market as rentals, which should expand the rental supply, thereby helping ease rent prices. This represents an interesting contrast to the peak of the housing market in 2006, when rental units were being converted into for-sale condos.

The 2010 national rental market data is calculated from a sample of one million concurrently active rental prices on HotPads and the for sale data is calculated from a sample size of 3.9 million prices. These are averages of each state’s monthly median price weighted by the number of listings in that state.

About HotPads.com

With over 500,000 active rental listings and 4 million homes for sale, HotPads.com is one of the largest national housing resources in the market today. HotPads.com is the premier map-based real estate search engine, delivering the most interactive and personal housing search experience online.

Need more info? Get in touch at Press@hotpads.com

2010 Housing Market Visualized

State % Change in Median Price of Rent % Change in Median Price of For Sale Jan 2010 Rent/ Buy Ratio Dec 2010 Rent/ Buy Ratio Change in Rent-Buy Ratio
2010 Housing Data from HotPads.com          
AK 0% -3.7% 21 20 -1
AL 6% -5.7% 21 18 -2
AR 1% -4.2% 19 18 -1
AZ 2% -18% 18 15 -4
CA 3% -17.8% 22 17 -4
CO 4% -14% 26 21 -5
CT 4% -9.1% 20 17 -3
DC 15% -5.5% 15 12 -3
DE 0% -4.2% 22 21 -1
FL 17% -14.3% 16 12 -4
GA 0% -11.1% 17 15 -2
HI 10% -6.3% 24 21 -4
IA 5% -9.7% 19 16 -3
ID 5% -7.8% 24 21 -3
IL 4% -16.3% 15 12 -3
IN 1% -4.2% 17 16 -1
KS -2% -3.3% 17 16 0
KY 0% -2.7% 18 17 0
LA -1% -9.3% 17 16 -1
MA 11% -14.3% 17 13 -4
MD 5% -9.3% 17 15 -2
ME 5% -2.5% 18 17 -1
MI -3% -11.5% 14 13 -1
MN -2% -11% 16 15 -1
MO 0% -6.7% 17 16 -1
MS 0% -6.3% 17 16 -1
MT -8% -6.3% 25 26 1
NC 2% -5% 20 19 -1
ND 7% -11.8% 25 20 -4
NE 1% -6.4% 17 16 -1
NH 0% -5.8% 20 19 -1
NJ 3% -8.8% 19 17 -2
NM 4% -5.4% 23 21 -2
NV -2% -21% 17 13 -3
NY 9% -6.8% 14 12 -2
OH 2% -3.9% 15 15 -1
OK 7% -3.3% 21 19 -2
OR 4% -9.8% 25 22 -3
PA 0% -8.5% 16 15 -1
RI 9% -11.1% 21 17 -4
SC 3% -12.2% 21 18 -3
SD -9% -6% 18 19 1
TN 4% -4% 18 17 -1
TX 1% -4.6% 17 16 -1
UT 3% -13.9% 24 20 -4
VA 5% -8.1% 16 14 -2
VT 9% -6.3% 19 17 -3
WA 5% -10.8% 22 19 -3
WI 2% -6.1% 18 16 -1
WV 12% -9.1% 16 13 -3
WY -7% -1.7% 22 23 1
State % Change in Median Price of Rent % Change in Median Price of For Sale Jan 2010 Rent/ Buy Ratio Dec 2010 Rent/ Buy Ratio Change in Rent-Buy Ratio
2010 Housing Data from HotPads.com          
AK 0% -3.7% 21 20 -1
AL 6% -5.7% 21 18 -2
AR 1% -4.2% 19 18 -1
AZ 2% -18% 18 15 -4
CA 3% -17.8% 22 17 -4
CO 4% -14% 26 21 -5
CT 4% -9.1% 20 17 -3
DC 15% -5.5% 15 12 -3
DE 0% -4.2% 22 21 -1
FL 17% -14.3% 16 12 -4
GA 0% -11.1% 17 15 -2
HI 10% -6.3% 24 21 -4
IA 5% -9.7% 19 16 -3
ID 5% -7.8% 24 21 -3
IL 4% -16.3% 15 12 -3
IN 1% -4.2% 17 16 -1
KS -2% -3.3% 17 16 0
KY 0% -2.7% 18 17 0
LA -1% -9.3% 17 16 -1
MA 11% -14.3% 17 13 -4
MD 5% -9.3% 17 15 -2
ME 5% -2.5% 18 17 -1
MI -3% -11.5% 14 13 -1
MN -2% -11% 16 15 -1
MO 0% -6.7% 17 16 -1
MS 0% -6.3% 17 16 -1
MT -8% -6.3% 25 26 1
NC 2% -5% 20 19 -1
ND 7% -11.8% 25 20 -4
NE 1% -6.4% 17 16 -1
NH 0% -5.8% 20 19 -1
NJ 3% -8.8% 19 17 -2
NM 4% -5.4% 23 21 -2
NV -2% -21% 17 13 -3
NY 9% -6.8% 14 12 -2
OH 2% -3.9% 15 15 -1
OK 7% -3.3% 21 19 -2
OR 4% -9.8% 25 22 -3
PA 0% -8.5% 16 15 -1
RI 9% -11.1% 21 17 -4
SC 3% -12.2% 21 18 -3
SD -9% -6% 18 19 1
TN 4% -4% 18 17 -1
TX 1% -4.6% 17 16 -1
UT 3% -13.9% 24 20 -4
VA 5% -8.1% 16 14 -2
VT 9% -6.3% 19 17 -3
WA 5% -10.8% 22 19 -3
WI 2% -6.1% 18 16 -1
WV 12% -9.1% 16 13 -3
WY -7% -1.7% 22 23 1

Real Estate Market News from Prospect Mortgage

January 12th, 2011

 
Last Week in Review: The labor market continues to improve, and while that’s good news for our economy, what does it mean for home loan rates?Forecast for the Week: Very impactful reports are in store for the week ahead – including a look at inflation, retail sales, and how American consumers are feeling these days.View: Breaking news… you won’t need to sweat the dreaded April 15th date this year. Find out why below.
Last Week in Review
 
“Whistle while you work.” Snow White.That’s something more people have been able to do lately, as the labor market continues to steadily improve. Here’s what December’s Jobs Report showed… and what it means for home loan rates.The Labor Department reported that 103,000 jobs were created in December, and private job growth was 113,000. While these numbers were below the recently ramped up expectations, they do show that the trend in the labor market is improving. Also noteworthy are the upward revisions to the prior two months readings, showing 70,000 more jobs created than had been previously reported.And yet, the real shocker in the report was a significant decline in the unemployment rate to 9.4%, which is the lowest unemployment rate since May of 2009.

So what did we learn from this Jobs Report?

1. While positive news, this Jobs number was still soft enough to support the Fed continuing on their plans for a full dosage of QE2 for the economy… and this won’t be good for Bonds and home loan rates, as it carries along some real inflation threat down the road.

2. The recent tax package and lower tax rate extensions have not yet had enough time to be seen or felt in the economy, so those factors should help provide further improvement in the labor market in future months… but also will create inflation – bad news for Bonds and home loan rates.

The bottom line for right now is that the familiar chant “Don’t Fight the Fed” continues to ring true. The Fed is intent on creating inflation, lowering the unemployment rate and raising Stock prices…and they have already been somewhat successful. QE2 will likely keep coming until the employment picture improves significantly, and this is all going to be unfriendly for Bonds and home loan rates ahead.

So what should you do if you have been thinking about purchasing or refinancing a home? The good news is that home loan rates are still extremely attractive right now, so call or email me now to get started. Or forward this newsletter on to someone you know how may benefit from today’s historically low rates.

Forecast for the Week
 
The latter half of the week ahead will hold the heavyweight economic reports. Be watching for:

  • … a double dose of inflation news, including Thursday’s Producer Price Index Report, which highlights inflation at the wholesale level, and Friday’s Consumer Price Index Report, measuring inflation for consumers… that’s you and me! Remember: The Fed is intent on creating inflation, which is unfriendly to home loan rates, and signs of inflation from these reports could be unfavorable for rates.
  • …Thursday’s weekly Initial and Continuing Jobless Claims Report. Last week, Initial Jobless Claims came in at 409,000, part of an encouraging overall trend that shows claims are getting closer to that important 400,000 mark, which represents a sign of continuing improvement in the labor market.
  • …Friday’s Retails Sales Report for December, as well as the Consumer Sentiment Index. Will they show that the Fed’s plans to stimulate the economy are working?

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.

As you can see in the chart below, Bonds and home loan rates ended the week about the same place as where they began…despite the tune of volatility that was in the air. Now would be a great time to call or email me if you have any questions about your situation!
———————–

Chart: Fannie Mae 4.0% Mortgage Bond (Friday Jan 07, 2011)

The Mortgage Market Guide View
 
Tax Deadline Extended!But What If You Need More Time?This year, instead of your tax filing being due on Friday, April 15, you’ll have a few extra days to complete and file your taxes. That means your tax filing isn’t due until Monday, April 18, 2011.

The three extra days have been added because of Emancipation Day, which is a little-known Washington, D.C. holiday that celebrates the freeing of slaves in the district. The holiday actually falls on Saturday, April 16 this year, but will officially be observed on Friday, April 15. As a result, the IRS pushed the filing deadline to Monday, April 18 – since the tax code states that filing deadlines can’t fall on Saturdays, Sundays or holidays.

Still Need More Time?

If you need more time to file your taxes, you can submit Form 4868 for a six-month extension. You can learn more about extensions on the IRS website.

Problems Paying?

But what do you do if you’ve completed your tax returns only to find out that you owe way more to Uncle Sam than you were expecting – or worse, that your tax bill is more than you can possibly afford to pay right now? Don’t worry. If this is the case, you’re not alone… especially in today’s economy. And, more importantly, you’re not going to jail just for being a little short on cash.

Rest assured, the IRS only seeks criminal charges for those who the agency can prove intentionally chose not to file and pay taxes. So, even if you can’t pay your bill right away, file your return on time, and not only will you stay off the IRS’s bad side, you’ll avoid some hefty financial penalties in the process.

Penalties and Interest Charges

According to the IRS, the penalty for filing late is generally 5% per month, or up to 25% of the total tax amount due. Not to mention interest charges, which the IRS changes quarterly, and which range between 4% and 9%. This interest applies to the unpaid balance, penalties, and to any interest that has been charged to the account as well.

If no effort is made to pay back-taxes, the IRS can impose stricter penalties, including levying bank accounts, wages, other income, or taking other assets like houses and cars. A Federal Tax Lien could also be filed, which could ruin your credit history for years to come.

The penalty for filing on time but paying late, however, is much lower. If you choose an installment plan to pay your debt, interest will accrue on the unpaid debt amount only. Therefore, when you file your return, pay as much as you can to help cut down the penalties.

Delayed Collection

If you absolutely cannot pay any part of your tax bill, the IRS may temporarily delay collection until your financial situation improves, although interest and penalties will accrue throughout this time. But this extension is reserved for what the IRS calls “significant hardship.” Your best bet is to talk to a CPA or tax professional if you cannot pay any part of your tax bill.

Whatever you do, DON’T just ignore the bill and assume the government will forget about it. Assess the situation, seek help from a tax professional, and make a plan to address the situation.
————————–

Economic Calendar for the Week of January 10-14, 2011

Remember, as a general rule, weaker than expected economic data is good for rates, while positive data causes rates to rise.

Economic Calendar for the Week of January 10 – January 14

Date ET Economic Report For Estimate Actual Prior Impact
Wed. January 12 02:00 Beige Book         Moderate
Thu. January 13 08:30 Jobless Claims (Initial) 01/08 420K   409K Moderate
Thu. January 13 08:30 Producer Price Index (PPI) Dec 0.7%   0.8% Moderate
Thu. January 13 08:30 Core Producer Price Index (PPI) Dec 0.2%   0.3% Moderate
Thu. January 13 08:30 Balance of Trade Nov -$40.6B   -$38.7B Moderate
Fri. January 14 09:15 Capacity Utilization Dec 75.5%   75.2% Moderate
Fri. January 14 09:15 Industrial Production Dec 0.4%   0.4% Moderate
Fri. January 14 08:30 Retail Sales ex-auto Dec 0.6%   1.2% HIGH
Fri. January 14 08:30 Retail Sales Dec 0.7%   0.8% HIGH
Fri. January 14 08:30 Core Consumer Price Index (CPI) Dec 0.1%   0.1% HIGH
Fri. January 14 08:30 Consumer Price Index (CPI) Dec 0.4%   0.1% HIGH
Fri. January 14 10:00 Consumer Sentiment Index (UoM) Jan 75.0   74.5 Moderate

The material contained in this newsletter is provided by a third party to real estate, financial services and other professionals only for their use and the use of their clients. The material provided is for informational and educational purposes only and should not be construed as investment and/or mortgage advice. Although the material is deemed to be accurate and reliable, we do not make any representations as to its accuracy or completeness and as a result, there is no guarantee it is without errors.

As your trusted advisor, I am sending you the MMG WEEKLY because I am committed to keeping you updated on the economic events that impact interest rates and how they may affect you.

Dana Dukelow
Prospect Mortgage
12301 Wilshire Blvd.
Suite 550
Los Angeles, CA 90025

Real Estate Market Update from Catalyst Lending

January 10th, 2011

January 10, 2011


MARKET RECAP

Home prices are the leading concern as we begin the new year. Clear Capital reports that prices dropped 4.1 percent across the nation in 2010, and it was a volatile decline at that. Values declined 5.3 percent over the first 12 weeks of the year, then spiked 9.7 percent through mid-August, only to drop 9.4 percent through year’s end. Clear Capital sees prices dropping another 3.9 percent through 2011.

Another analytics firm, Altos Research, also reports less-than-encouraging pricing news. According to Altos, home prices dropped 1.6 percent in December, with new listings actually hitting the market lower than that. The good news from Altos is that prices will “likely” increase modestly as we head into the spring season. Shadow inventory remains a concern, but Altos reports that inventories were cut nearly 6 percent in the 10 largest markets in December.

The latest spat of negative data doesn’t mean we should throw in the towel on price stability, or that buyers should wait for lower prices before taking the dive into the housing pool. The heavy across-the-board discounting is over. Changes in prices going forward will be incremental and specific to local markets – some markets will see additional discounting, some won’t.

What’s more, markets are dynamic: money saved from any additional discounting could easily be offset by mortgage-rate increases. Goldman Sachs expects that the Federal Reserve will end its second round of quantitative easing in June, and that 10-year Treasury yields (a benchmark for 30-year mortgage rates) will climb to 3.75 percent by year-end, and then advance to 4.25 percent by the close of 2012. The historical average spread between a prime 30-year fixed-rate mortgage and the 10-year Treasury note is around two percentage points, which means if Goldman Sachs proves accurate on its prediction, we could be looking at 5.75 percent 30-year loans this year and 6.25 percent loans in 2012.

Of course, a forecast is no sure thing. In fact, forecasts are often wrong, but there are mitigating circumstances to consider. A majority of top decision-makers at the Federal Reserve believe that concerns over falling prices have eased and that inflation will gradually rise. Recent data support that belief: employment is improving – ADP Employer Services reports that 297,000 new private-sector jobs were created in December, triple the consensus estimate; manufacturing has expanded for 17-consecutive months; stocks continue to trend up; and rising food, energy, and commodity prices are stoking inflation fears.

Our advice remains the same as it has for the past two months: get the mortgage application in, and, unless you have a strong gambler’s constitution, lock instead of playing the floating-rate game. We don’t think borrowers will be giving up much. Let’s remember that we are still within 50-basis points of a 50-year low.

Economic
Indicator
Release
Date and Time
Consensus
Estimate
Analysis
Wholesale Trade
(November)
Tues., Jan. 11,
10:00 am, et

1.1%
(Increase)

Moderately Important. Strong business activity will lead to stronger activity on the consumer side.
Mortgage Applications Wed., Jan 12,
7:00 am, et

None

Important. Purchase applications are expected to drive mortgage activity going forward.
Import Prices
(December)
Wed., Jan 12,
8:30 am, et

1.2%
(Increase)

Important. The uptrend in prices is raising inflation concerns.
International Trade
(November)
Thurs., Jan 13,
8:30 am, et

$39 Billion (Deficit)

Moderately Important. More exports are offsetting higher import prices to shrink the trade deficit.
Producer
Price Index
(December)
Thurs., Jan 13,
8:30 am, et

All Goods: 0.8% (Increase)
Core: 0.3% (Increase)

Important: Producer costs are rising at an increasing rate and could pressure consumer prices.
Consumer
Price Index
(December)
Fri., Jan. 14,
8:30 am, et
All Goods: 0.4% (Increase)
Core: 0.2% (Increase)
Very Important. Consumer-price inflation has returned, limiting the chances of further interest-rate reductions.
Let’s Not Forget the Other Half

Actually, it’s much more than half. Most media accounts are peppered with sad stories of people who are under water or who are facing foreclosure because of job loss or because they simply took on too much house and too much financing. The fact is that the vast majority of mortgagors have a job and are current on their payments.

Many of these folks are underwater, to be sure, but most are not, so there is still plenty of opportunity for plenty of people to buy, invest, or sell. While there is currently some slack in demand, reduced prices and low interest rates should keep home purchases attractive. The market is now simply waiting on a robust recovery – most likely lead by job growth – to spur consumers into taking advantage of very affordable conditions.

A strong recovery appears to be at least a year, or possibly two, away. But as we’ve stated, if we wait for a strong recovery to be in full force, the bargains (and the low financing rates) will be gone. That’s a lesson worth imparting to the half that is still fearful of the recent past or needs a consensus backing it before it will act.