“BREAKDOWN, TAKEDOWN…YOU’RE BUSTED!” —Bob Seger

That classic 80’s lyric aptly describes the market last week, as the Stock market suffered a breakdown, analysts got a takedown, and many investors felt they were busted as Stocks sold off hard on Friday. Why? The result of a super lousy Jobs Report number on Friday morning. US job growth in August was actually negative for the first time in four years, with a loss of 4,000 jobs. And the shocker was that analysts had expected somewhere close to 110,000 new jobs to be created !

But while Stocks suffered on the news, Bonds benefited, meaning that home loan rates on conforming loans improved by .125% to .25%. Additionally, the dismal Report also means the Fed is almost guaranteed to make a cut to the Fed Funds Rate at their upcoming meeting on September 18th, to help stimulate a sagging economy. And in fact, their cut now may be a .50% cut, rather than the .25% that has been speculated.

This action would help stimulate business at large, with less expensive costs to borrow - and also help consumers as well. The Fed Funds Rate impacts many other borrowing rates, such as Home Equity Lines, credit cards, car loans and the like.