Last Week in Review...

     Last week there was news that the European Central Bank (ECB) stopped providing funding to some Greek banks, adding to the drama in the region. ECB President Mario Draghi backed the move saying that the ECB will not compromise "the integrity of our balance sheet" to bail out Greek banks and the recapitalization effort must come from the Greek government themselves. 

     What will be made of Greece? Will there be a "Grexit," with the country exiting the Euro? What's more, Spain looks like it will be in a recession throughout 2013 and that country is drowning in debt with Bond yields now approaching very lofty levels. When there is this much risk out in the market, Traders seek a safe haven like the US Dollar and US Bonds...and the drama and risk in Europe benefitted our Bonds (including Mortgage Bonds, to which home loan rates are tied) last week. 

     Here at home, inflation as measured by the Consumer Price Index (CPI) came in at 2.3% year-over-year. Remember, inflation hurts the value of fixed investments like Bonds (thus, hurting home loan rates)...so inflation staying in check is crucial when it comes to home loan rates remaining near record best levels. And while the year-over-year CPI reading was the lowest since February 2011, it's important to realize that there is a negative correlation between inflation and what Treasuries are yielding...and this negative correlation can't last forever. Investors will not continue to "lose" money to inflation by holding Treasuries. Either inflation has to moderate a lot OR the Bond Market has to adjust for inflation with prices moving lower. This will result in home loan rates moving higher.

     The bottom line is that home loan rates remain near historic lows and now continues to be a great time to purchase or refinance a home. Let me know if I can answer any questions at all for you or your clients. 

Don't Click That Link! 

Beware of Smart Phone SMS Scams

     Smart phones can make life - not to mention business - much easier. You can send and receive text messages in a flash to clients and colleagues. You can even text links to important web pages that can be opened right on a smart phone.

     Of course, those same benefits make scams much easier for criminals. Take for instance the latest craze: smishing. 

What Is Smishing?

     Smishing uses SMS technology to deliver fake (and criminal) messages. In fact, the name actually comes from combining the acronym SMS with the word phishing (that is: SMs + phISHING = SMISHING).

How Does It Work?

     It works much like a phishing email, except you receive it on your smart phone as a text message. It starts with a text message to your phone, often stating that you've won a prize or that your account requires some kind of update.

     Two recent smishing scams consist of text messages that appear to be sent by Best Buy or Wal-Mart, stating that you've been randomly selected for a $1,000 gift card. The text message includes a link to a web page that looks professional and official. But it's not. It's really just a clever way for criminals to collect your personal data.

What Should You (NOT) Do?

     If you receive any message that seems out of the ordinary or too good to be true, take the following precautions: 

*  Don't open: If you didn't register for a prize, you probably didn't win one. So always be skeptical about emails or text messages that are unsolicited or offer free prizes that you didn't register for yourself. If you see one that looks suspicious, don't open it.

*  Don't click: If you do open the message before you realize it's suspicious, don't click the link.

*  Don't reply: Sometimes, people try to reply STOP in an effort to avoid receiving future text messages. But what they don't realize is that there isn't a list in most cases. Instead, criminals program their computers to randomly dial/text different phone number combinations. So, by replying to the message, you may actually be informing the criminals that you have an active number that received the message.

*  Don't call: Some smishing text messages will direct you to call a phone number rather than click a link. That may lower your guard, but the toll-free number is just part of the plan. Once you dial it, you'll hear an automated voice that will collect your personal data for use by the criminals. If you do decide that you want to check if the message is real, don't dial the number in the text or email. Instead, look the number up in the phone book or on a reputable site. 

     Here are just a few options that you should do if you receive a suspicious message:

*  Delete: One of the best options is to simply delete the suspicious text or email.

*  Report: You can also report the scam by filing a complaint on the FBI's Internet crime website at http://www.ic3.gov.

*  Stay up to date: You can stay up to date on the latest scams by following websites that track these issues. One option is the website ScamBook.com, which relies on user submissions to track everything from smishing to false advertising.

     The bottom line is that no reputable company would text you to ask for your information. Keep your guard up and be suspicious of anything that seems odd or too good to be true. And remember to pass these tips on to your friends, family members and clients.