Besides yesterday’s Treasury auction, we had little scheduled news yesterday and rates finished the day flat. Given that rates started off the day being worse than Tuesday’s close, some lenders issued rate improvements, especially after the Fed’s Beige Book showed continued economic weakness – especially in housing. One trader wrote, “We are going to look [...]

Wells Fargo Bad Loan Repurchases Fell In 3Q Yesterday we learned that Wells Fargo’s repurchase obligations fell in the third quarter. Wells Fargo, who has not stopped foreclosure processes, reduced its reserve for repurchases to $1.3 billion from $1.4 billion in the second quarter, and outstanding buyback requests fell to $3.8 billion of loans from [...]

Commercial Paper As Credit Crunch Indicator “Commercial paper” is used by businesses to finance their own working capital, meet payroll and pay suppliers, etc. From the third quarter of 2007 to that of 2008, GDP grew by 3.4% while outstanding commercial paper fell by 25%, losing about $600 billion. Asset-backed commercial paper fell by 40%. [...]

I was reminded that 70% of the US economy is propelled by consumers, all consumers. Last night, after giving a speech to some UC Berkeley econ students, I was in a book store and the gal in front of me asked the clerk, “Do you have a book on ‘Karmageddon’? Its like, when everybody is [...]

An Underwriter Explains Why Are Loans So Hard To Approve Lately I have been hearing from producers, some of whom are upset about the current lending environment, some not. But for a slightly different view of things, here is what one very experienced and knowledgeable underwriter wrote to me. This is worth the read even [...]

Why are you IN a movie, but you’re ON TV? In the TV yesterday, at least the financial news networks, was the Fed’s Beige Book which comes out eight times a year and summarizes the Fed’s twelve districts. So do mortgage companies want the economy to do well, and run the risk of higher rates, [...]

The Fed’s Beige Book released today, a regional economic survey done across the Fed’s 12 districts, showed that housing weakened or remained soft and that there was a general pullback in hiring up until August 25. Because of the slowdown, the Fed shouldn’t have a reason to hike rates before the end of the year. [...]

During the past two days, March producer inflation (PPI) came in way above expectations at 1.1%, showing pricing pressure for manufacturing sectors, and March consumer inflation (CPI) came in right at the expected .3% mark. Excluding volatile food and energy costs, both numbers were in line with expectations. However, when food and energy sustain sharp [...]

The last time mortgage rates were this bad compared to Treasury rates, dinosaurs roamed the earth…and this morning it continues. After Jobless Claims fell 24,000 to a much lower-than-expected 351,000, we find the 10-yr at 3.67% but 30-yr mortgage prices worse by .50 in price. Fixed income investors need to be reminded why they should [...]