market: Tripping over Dollars to Pick Up Pennies - 01/30/09 09:09 AM
Thirty year mortgage rates have been moving higher over the past week and are currently at 5.5%. Many of you know that over the past month rates moved as low as 5% for 30 year fixed mortgage loans.
After a few days of pricing pressure, Mortgage Bonds are trading near "oversold" conditions, which could make prices ripe for a reversal higher. If you couple that with the strong underlying support, it gives reason to be optimistic that the rates will mover lower in the next week. I'm watching very carefully and will be advising my clients to lock if the rates … (11 comments)
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market: Today's Market News....for mortgage lenders!!!! - 12/18/08 09:00 AM
Mortgage prices shot out of a canon yesterday morning as prices surged to all time highs. This was so cool....but no sooner did it take off than it gave it all back and then some. However, a heavy dose of origination sent prices downward as buyers quickly became sellers. Liquidity in the lower coupons was horrible as pricing became extremely choppy. We lenders had a rough morning as prices were moving faster than rate sheets could be set. According to Fannie.....To make matters worse, the screens we use to price were grossly inaccurate at times. It was definitely a volatile time in my office. And I was had a … (2 comments)
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market: Today's Stunning Economic News....Great for Rates - 12/16/08 04:41 PM
Good afternoon,
Fed cut the target Fed Funds rate from 1.00% to a range between 0.00% and 0.25%. The 75 basis point cut was larger than the consensus forecast for a 50 basis point cut. This marked the first time that the Fed has targeted a range rather than a fixed value, reflecting that it is more difficult for the Fed to precisely target a rate in the current market environment. The Fed's statement confirmed that economic conditions have worsened recently and suggested that rates will remain at extremely low levels for an extended period of time. Also notable, the Fed … (7 comments)
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market: This Past Week's Economic Summary...interpreted my your's truly. - 08/17/08 08:11 PM
… (2 comments)
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market: The Trend is our Friend??? Does 1 month make a trend? - 08/07/08 03:38 PM
Pending home sales rebounded by 5.3% in June, according to the National Association of Realtors (NAR), against expectations that the index would fall by 1.0%. The bounce is better than the most optimistic forecasts and follows a downwardly revised 4.9% drop in the prior month.
This is the second unexpected bounce in the past three months. April's index rebounded 7.1% after the seven-year index hit an all-time low in March.
What does this mean? Not really much unless the trend continues. However, during the times of real estate lull and incapication, its definitely a welcome stat that hopefully, yes....hopefully will segue … (7 comments)
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market: Foreclosures up 121%....can you say gross????? Vegas leads the pack - 07/25/08 09:52 PM
U.S. home foreclosures soared by 121% in second-quarter year-over-year results, according to a report issued by RealtyTrac. Realty Trac (RT), said that there were 739,714 foreclosure filings in the second quarter of 2008, a 14% quarterly increase. According to RealtyTrac, 48 of 50 states and 95 of 100 of the largest metropolitan areas experienced year-over-year increases in foreclosure activity in the second quarter.
Bank repos were 30% of the total for the second quarter, up from 24% of the total in the first quarter. Nevada was the highest highest monthly foreclosure rate. That There were 24,657 foreclosures filings in the second … (6 comments)
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market: Today's Abbreviated Market Recap!!!! - 07/24/08 10:06 PM
Good Evening Sports Fans!
Here's a recap of the heavys determining today's market. I picked most of this off of Bloomberg, but a great day for interest rate improvements nonetheless....
•§ DJIA was down 283 points
•§ Oil was up $1 to $125.45
•§ With the exception of Radian and Thornburg, the rest of the watch list was in the red today
•§ Fannie Mae and Freddie Mac down almost 20% on the day
•§ The Fannie Mae 6.0 September coupon closed above par! (up 19.5/32 or 61 bps)
•§ Interest rates across the board rallied in price, pushing rates lower
… (0 comments)
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market: Fannie and Freddie - - - Gross! - 07/11/08 02:46 PM
… (11 comments)
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market: Reviewing Yesterday's Bernanke's Comments - 06/10/08 10:00 AM
BOTTOM LINE: Speaking last night, Bernanke noted that the economy is still fragile with downside risks to inflation and upside ones to growth. He notes risks to the upside on inflation from the continued increases in the price of oil. Greatest concern, and strongest language, devoted to the possibility of inflation expectations becoming unanchored. Passthrough into other prices has remained limited. On the other side of the balance, he notes that Fed action has reduced risks of a "substantial downturn" though downside growth risks certainly remain.
KEY POINTS:
1. At a Boston Fed conference on inflation -- more specifically the Phillips … (1 comments)
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market: Inflation Today translated for the average Joe - - - crazy stuff here! - 05/15/08 04:09 PM
Some notes regarding inflation enclosed.
National trucking/transportation companies are now charging a 31% gas surcharge for all deliveries. ~It costs 31% more to deliver goods than it did last year!
To keep the prices of Oil in perspective:
Current costs ~$125/barrel for Oil.
19.5 gallons of gasoline are produced from each barrel.
Thus, the cost per gallon should be $6.41!!!
Starbuck Analogy:
16 oz of Starbucks Coffee = $3.50 (if you get something with espresso).
There's 8 cups per gallon: Each gallon of coffee costs 8 x $3.50 = $28/Gallon.
There's 42 Gallons per barrel: 42 x $28 = $1,176/barrel … (2 comments)
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market: New Government Action to Rescue the Housing Market Just Happened - 05/09/08 02:42 PM
Fannie Mae Changes Policy and Pricing on "Conforming" Jumbos
Fannie Mae announced a series of new initiatives called "Keys to Recovery" in its first quarter 08 report. This effort is geared toward basically providing liquidity, stability, and affordability to the housing and mortgage markets for the long term, keeping struggling borrowers in their homes, assisting prospective home buyers with home purchases, and stabilizing communities affected by the mortgage market downturn. According to the report, the initiatives include:
1) A new refinancing option for up-to-date but "underwater" borrowers with loans owned by Fannie Mae that will allow for refinancing up to 120 … (2 comments)
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market: Today's Markets....just a little more of the same....but good for bonds - 03/25/08 10:18 AM
Yesterday...
Rates rose sharply on Monday, pushing Treasury yields up 20bp or more and returning yields to their early-March/late-February levels across the curve. The FHLB got final approval to double mortgage investments. While several reasons were raised for the MBS sell-off, it appeared technical in nature with participants having decided that yields had just moved too far, too fast. Yesterday's sell-off, along with the prior Monday's, was one of the most severe one-day routs in years. JPMorgan's increased offer for Bear helped lift stocks as did the existing home sales report. In February, existing home sales rose 2.9% but the optimism with … (3 comments)
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market: Market trends from weekend Fed Activities - 03/17/08 09:26 AM
In an emergency move, the Fed cut the discount rate (the rate on direct loans to banks) by 0.25% to 3.25%. The Fed also announced that it will create a lending facility for the 20 primary dealers (the first time the Fed has extended financing to non-banks since the Great Depression), which will remain in place for at least 6 months. Bear Stearns continues to make headlines this morning on news that JP Morgan will purchase the firm for $2 per share, which is less than 1/10th of the Bear's value as of the close last week. The Fed has agreed … (5 comments)
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market: Bernanke and Fed are in the process of changing Respa....what this means to you. - 03/16/08 11:11 PM
Alphonso Jackson, Secretary of Housing and Urban Development Friday proposed a mortgage reform designed to help consumers better understand the terms of the loans they are considering and offering guidelines for shopping for different products. This is cool since many consumers don't understand what's been put before them and unscrupulous lenders prey upon victims by not explaining truths to consumers.
If approved, the changes will reform Real Estate Settlement Procedures Act (RESPA). First HUD is proposing that mortgage brokers and lenders provide consumers with a standard Good Faith Estimate. Jackson said that by offering consumers clearer, more certain cost estimates the average borrower will save … (6 comments)
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market: Markets are Like a Wild Disney Ride - 03/13/08 05:28 PM
Weekly jobless claims data reflected a mixed activity. Initial claims (week ending March 8th) were unchanged at 353k, relative to the estimate of 357k and last week's upwardly revised level of 353k. The prior week's level was originally reported as 351k. As you are well aware, we like to look at moving averages for this data series to mitigate some of the weekly noise inherent in the data. The four-week average is 359k and the twelve-month average is 326k. This appears to reflect a labor market that is continuing to weaken. Continuing claims (week ending March 1st) rose to 2.835 million, … (2 comments)
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market: On top of the Roller Coaster coming down - 02/29/08 11:05 PM
Wow...last week, I was talking with people who were seriously considering getting out of the real estate business. You see it was only 3 weeks ago that mortgage rates were awesome. They were quite stimulating for the economy....a reprieve, if you will in the bastion of negative real estate news.
Last week, however, mortgage rates had escalated to where they were eyeing the 7.0% mark. That brought out the naysayers who, after three weeks of bad economic data coupled with inflationary remarks by Bernanke, said that maybe it was time for them to "shift out of real estate" and into something … (2 comments)
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market: Keep your eyes on the prize!!!! - 02/19/08 10:28 PM
This market is insane. Bond prices got rocked today. The rates shot up....AGAIN!!!! That's all that has been happening receintly. Bernanke, last week, said that our economy sucks, but we have worries of inflation. So our stock market drops, but the rates go up! When the stock market goes up, rates go up. When it drops, rates follow. Bernanke speaks and the stock market drops. Then he says that we're inflationary. Well which is it?????? You see if our economy sucks, the our rates should be going down? Right?
Well what's a guy supposed to do with a out of whack … (0 comments)
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market: Today's Market News - 02/12/08 09:24 AM
Bond prices rose a touch on Monday in quiet trading. The big news of the day came from insurer AIG who said that its prior accounting for credit default swaps was in error and the previously reported $1.6 billion in write-downs really turned out to be $4.88 billion. The error was found by PWC auditors and will probably not be the last one auditors identify at companies in the coming months as the turmoil of the fall, complexities of instruments, and illiquidity stretched accounting and other systems and procedures. Wow...honest mistake or more behind the facade?
There was also news on Monday that … (0 comments)
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market: Today's Market....the cyclone continues to spin.... - 02/08/08 09:42 AM
Today's Market CommentaryBond prices plunged on Thursday as a miserable thirty-year auction, hawkish comments from Dallas Fed President Fisher, and technicals combined to batter bonds. Yields rose 15bp or more across the bulk of the curve. Despite selling at the lowest level since 30yr auctions began in 1977, the long-bond auction was very weak as the award rate of 4.449% was much weaker than the bid side of the market (4.404%) at auction time. The indirect allotment was 10.69% and the coverage ratio was 1.82. This compares to a 27.2% and 2.13 average, respectively, for the last six 30 year auctions. … (4 comments)
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market: Today's Market.... - 02/06/08 09:22 AM
Although Tuesday was billed as "Super Tuesday" for the Presidential nominating process, for the economy and stocks, it was everything but a super day. The ISM non-manufacturing index, which has grown in stature over the past couple of years even though it still carries less weight than its sister report, produced Tuesday's shocker, plunging to 44.6, its lowest level since the index began being published in 2004 and eight points below estimates. Plunging to recessionary levels, Merrill Lynch this morning noted that the ISM plunge could contribute to the Fed making an intra-meeting cut before the mid-March FOMC meeting. Because the … (2 comments)
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