However, it’s not all sunshine in this prediction. Dumas is worried about 2010, predicting there could be another “downward leg” in the economy then.

While the average rate on a fixed 30-year mortgage fell to 5.18 percent last week from 6.47 percent in October, according to Mortgage Bankers Association data, the historical relationship between home loans and mortgage bonds shows rates should be at least half a percentage point lower. Though the U.S. is paying nothing to borrow in some cases, homebuyers are paying about $730 more a year than they would otherwise on a $200,000 mortgage. The demise of lenders including Countrywide Financial Corp. of Calabasas, California, and Seattle-based Washington Mutual Inc. reduced competition as refinancings soar. At the same time, surviving mortgage banks face a credit crunch that limits their lending ability, industry officials say. “Lenders have raised their prices over the last few weeks because of capacity concerns amid all this additional business,” said Brian Simon, chief operating officer at Freedom Mortgage Corp. The Mount Laurel, New Jersey-based firm is among the five biggest independent mortgage companies.

FedEx Corp. said Thursday its fiscal second-quarter profit edged up nearly 3%, but challenging times are ahead in "the worst economic conditions" in the company's 35-year history spurred pay cuts and a hiring freeze. For the recent quarter, the Memphis, Tenn., shipping giant said earnings rose to $493 million, or $1.58 a share, from $479 million, or $1.54 a share, in the year-ago period. Revenue rose 1% to $9.54 billion.