Latest interview on Blog Talk Radio. 7/1/13

I talk about the Fed, interest rates, and real estate.

Morning Report – Record outflows in bond funds 7/1/13

Vital Statistics:

Last Change Percent
S&P Futures 1607.5 8.2 0.51%
Eurostoxx Index 2618.1 15.5 0.60%
Oil (WTI) 97.87 1.3 1.36%
LIBOR 0.273 0.000 0.00%
US Dollar Index (DXY) 83.16 0.022 0.03%
10 Year Govt Bond Yield 2.53% 0.04%
Current Coupon Ginnie Mae TBA 102.3 -0.2
Current Coupon Fannie Mae TBA 101.3 -0.2
RPX Composite Real Estate Index 205.3 -0.2
BankRate 30 Year Fixed Rate Mortgage 4.39


Markets are higher on no real news. The Markit US Purchasing Managers Index came in a little lower than expected. Later this morning we will get construction spending and the ISM manufacturing. ISM could be market moving. Bonds and MBS are down.


This week is relatively data-light, with the 4th of July holiday in the middle. The highlight of the week will be the jobs report on Friday.


record $80 billion was pulled out of bond funds and bond ETF funds in the month of June, according to Trim Tabs. This record outflow is also based on people who follow the news closely. Q2 statements are coming out soon and a lot of people who don’t follow their investments closely may be in for a shock. Which means we could face another deluge of selling.


Delinquencies are falling again, with serious delinquencies dropping to 2.83% in the month of May, according to Fannie Mae’s monthly summary. Serious DQs were 3.57% a year ago. Separately, Citi paid just under $1 billion to settle buyback claims on mortgages originated from 2000 to 2012.


I will be on Capital Markets Today later this afternoon discussing the latest from the bond markets

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