Good morning, and happy Friday! The Fed’s total MBS purchases for the next two weeks are going to drop to $54.6 billion vs. last cycle’s $71.7 billion. A change in one cycle is certainly not enough to establish a trend, but if Fed purchases continue to taper off, that would suggest a more moderate position on quantitative easing going forward. Currently, large purchases by the Fed are driving up MBS prices; however, a significant pullback would result in the opposite effect: lower prices would cause an increase in mortgage lending rates. It will likely be months before that case materializes. In other news, those who are calling housing a bubble may be on to something. Around the globe, people are panic-buying property due to fears surrounding the current lack of inventory. When prices are reacting strongly to factors outside of normal supply and demand dynamics – such as panic – that suggests the presence of a bubble.
In bonds today, the 10yr. T-note is +2/32 to yield 1.64%, and the FNMA 30yr. 2.5% is trading at $103-13 to yield 1.73% with a +91 spread over the treasury curve. Call us if you have questions or want to buy or sell MBS! Thanks, and have a wonderful weekend!
Cherry Picks
10 Year Fixed
15 Year Fixed
20 Year Fixed
30 Year Fixed
Agency CMBS
Agency CMO – 3 Year
Agency CMO – 5 Year
Agency CMO – Long End
Jim Tait is a registered representative with and offers securities through Hanover Securities, Inc. (Hanover), Member FINRA & SIPC. Although this information has been obtained from sources we believe reliable, we do not guarantee its accuracy, and it may be incomplete or condensed. This is for information purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. Securities that may be shown are subject to availability and changes in price. Past performance is not indicative of future results. Changes in any assumptions may have a material effect on projected results.
This information from Hanover Securities is for your private use and does not constitute an offer or solicitation with respect to the sale of any security. This information was obtained from sources we believe to be reliable but we do not represent that it is accurate or complete, and it should not be relied on as such. Certain transactions may give rise to substantial risk and are not suitable for all investors. This information was based on current market indicators which may vary over time. We may from time to time buy or sell, or have long or short positions in securities identical or related to those identified herein.
Although this information has been obtained from sources we believe reliable, we do not guarantee its accuracy, and it may be incomplete or condensed. This is for information purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. Loans and/or Securities which may be shown are subject to availability and changes in price. Past performance is not indicative of future results. Changes in any assumptions may have a material effect on projected results. This information from Banes Capital Group (BCG) and/or Hanover Securities is for your private use, and was obtained from sources we believe to be reliable. However, we do not represent that this information is accurate or complete, and it should not be relied on as such. This information is for institutional investors only, and as such certain transactions may give rise to substantial risk and are not suitable for all investors. This information was based on current market indicators which may vary over time. We may from time to time buy or sell, or have long or short positions in loans or securities identical or related to those identified herein.
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