The Market is Letting You Back In

Vital Statistics:

	Last	Change	Percent
S&P Futures	1738.0	1.5	0.09%
Eurostoxx Index	3026.5	-6.8	-0.22%
Oil (WTI)	99.68	-1.1	-1.12%
LIBOR	0.239	-0.002	-0.81%
US Dollar Index (DXY)	79.76	0.104	0.13%
10 Year Govt Bond Yield	2.59%	0.01%
Current Coupon Ginnie Mae TBA	105.9	0.2
Current Coupon Fannie Mae TBA	105.1	0.0
RPX Composite Real Estate Index	200.7	-0.2
BankRate 30 Year Fixed Rate Mortgage	4.23

Markets are flat this morning on no real news Bonds and MBS are down small. We will get existing home sales later this morning.

The government is still figuring out how it will release the economic reports that piled up during the shutdown. I don't see anything official from BLS regarding the jobs report, although Bloomberg has it scheduled for tomorrow. I think it will take a massive jump in payrolls (like 300k +) to bring a December tapering back into the picture. Given that we just kicked the can down the road for a few months, we are probably looking at March. FWIW, Chicago Fed President Charles Evans said pretty much the same thing on CNBC.

Homebuilder NVR rerpoted a 37% increase in revenues for the third quarter. Closed loan production was just under $700 million for the quarter. Origination volume actually increased about $50 million from Q2. New orders fell 7% and the cancellation rate edged up to 17%. Earnings came in well above expectations. NVR is more East Coast based and DC-centric (think McMansions in McClean VA) so it will be sensitive to government spending. We will hear from Pulte later this week. 

The Bankrate average 30 year fixed rate mortgage fell to 4.23% last week, the lowest since June. We had fantastic lock days on Thursday and Friday. LO's wake up any borrowers that are on the fence or were thinking about refinancing. The market just let them back in. 

JP Morgan is close to a settlement with the government over the sins of Bear Stearns. (Didn't Jamie Dimon buy Bear as a "favor" to the government?) Anyway, it is looking like it will be $13 billion. Whenever the government needs money, it shakes down Wall Street, I guess. At what point are these things no longer "fines," but "surtaxes?"

Brent Nyitray, CFA

Dellacamera Capital Management

iDirect Home Loans

1010 Washington St, 6th floor

Stamford CT 06901

T: 203-817-3614

C: 917-841-4938

bnyitray@dcm-funds.com

AIM bnyitray