The appraiser came by this afternoon to inspect the Renovation House by way of arranging the proposed refinance, which at the moment is switched off, what with the interest rates now higher than we’re paying on the present loan.

But we’ve already agreed to move forward with setting up the loan, so say goodbye to $350 in processing charges, including this guy’s fee. He took careful note of all the upgrades we did inside the house and seemed to be impressed that everything is less than a year old. If some of these improvements make a difference, as I hope they will, maybe the house’s value will be no less than we paid for it.

Rumor has it the Fed will cut rates again. I’ll believe it when I see it: to my mind those rumors are pretty vague. Friends and M’hijito think mortgage rates will come down. I remain skeptical.

1. • Inflation is a-rising. Rate cuts by the Fed are inflationary; how can I count the ways Bernanke does not want to fuel inflation?
   

2. • Even if the Fed cuts its key interest rate, it’s no guarantee mortgage rates will fall. Banks have to make up their losses somehow. If they’re not writing many new loans—which they can’t until real estate starts to move—then the only way for lenders to stay afloat in the mortgage biz is to keep rates high.
   

Prices on necessities such as food and gasoline can go nowhere but up.

Oil supplies are dwindling; couple that with the various political pressures and you know that we won’t see a drop in the cost of fuel anytime soon. Rising transportation costs inevitably will push costs of everything else higher.

Meanwhile, we’re busy converting acreage that should be used to produce food for people and livestock into enormous flat oil wells. As less land is available to grow food, less food will be available and so of course prices for food will rise. This means we’ll be facing two inflationary forces at the grocery store: the cost of moving food from the farm to the consumer, and a drop in supply with no corresponding drop in demand.

Well, if mortgage rates drop back to 5.25 percent, I’ll grab it. But I’m not holding my breath.

debt, real estate