March 9

3/9 – COVID-19 is threatening the U.S. economy. Last week, most economists cut their 2020 GDP forecasts: IHS Markit from 2.1% to 1.8%; Oxford Economics from 1.7% to 1.3%; Deutsche Bank from 2.2% to 1.6% and the Federal Reserve Bank of NY from 2.2% to 1.5% for the first half of 2020. The Federal Reserve cut interest rates by a half-point last week, its largest cut since its response to the Lehman Bros. collapse in 2008. On the flip side there was some good news. Unemployment is still at 50-year lows of 3.5%. Yields on government bonds have dropped to new lows - and that helped push mortgage rates to all-time record lows last week. The Freddie Mac weekly survey showed an average of 2.79% for a 15-yr conventional mortgage and 3.29% for a 30-yr. According to AAA, the national average for gas prices is $2.39/gallon, the lowest since Feb 2018.