Morning Report – Still no data 10/18/13

Posted on October 18, 2013 by Brent Nyitray

Vital Statistics:

  Last Change Percent
S&P Futures  1732.7 4.9 0.28%
Eurostoxx Index 3022.5 12.1 0.40%
Oil (WTI) 101.4 0.7 0.71%
LIBOR 0.241 -0.002 -0.62%
US Dollar Index (DXY) 79.62 -0.027 -0.03%
10 Year Govt Bond Yield 2.57% -0.02%  
Current Coupon Ginnie Mae TBA 105.9 0.2  
Current Coupon Fannie Mae TBA 105.2 0.2  
RPX Composite Real Estate Index 200.7 -0.2  
BankRate 30 Year Fixed Rate Mortgage 4.24    
Markets are higher this morning on a couple of good earnings reports out of Morgan Stanley and GE. The 10-year continues its post-crisis rally.
 
The government has been back at the job, but still no economic data this morning. Apparently the September jobs report will be released Tuesday. And some of the data we will get will be less than reliable.
 
As bonds move lower, so do mortgage rates. Since early September, the average 30 year fixed rate mortgage has fallen to 4.24%, which is the lowest level since June. Mortgage Bankers may in fact get one last bite at the refi apple before rates start heading higher for good.
 
 

 
 
The increase in rates has brought some anecdotal evidence that the red-hot California market is beginning to cool a bit. The flippers are focusing on the higher end homes, as the lower price points have been picked over. According to the California Association of Realtors, home sales were down 5% in September, and the median price fell.
 
The National Association of Homebuilders sentiment index fell in October as builders worried about the cost and availability of labor as well as the events in Washington. We have been hearing about skilled labor quite a bit – in spite of high unemployment, employers are finding it hard to fill certain positions. The biggest one is skilled labor. The housing bust sent many skilled laborers to the energy patch, which means there are less electricians, plumbers, etc. The NAHB is forecasting housing starts to be around 900,000 units for the month of September. This is still well below our historical average of 1.5 million. As the echo boomers find jobs, we should be in store for a massive, massive building boom given that we have tremendous pent-up household formation and we have underbuilt for the past decade.
 
 

 
The beatdown goes on… Wells is laying off 925 in mortgage ops. Suntrust is laying off 800. 
 

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34 Responses

  1. Brent Nyitray's avatar
    Brent Nyitray, on October 18, 2013 at 8:54 am said:

    Frist. Also The Kruginator is blaming Republicans for hiking the payroll tax at the beginning of the year. Thats a novel interpretation of events – as if Republicans were bound and determined to hike taxes and obama was holding them back.

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  2. Let the mutherfuker burn!'s avatar
    Troll McWingnut or George, whichever, on October 18, 2013 at 9:01 am said:

    Who’s the black private dick
    That’s a sex machine to all the chicks?
    SHAFT!
    Ya damn right!

    In other news, why isn’t the media celebrating the trillions in debt being incurred by their country?

    I’m confused.

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  3. novahockey's avatar
    novahockey, on October 18, 2013 at 10:31 am said:

    http://reason.com/blog/2013/10/18/european-cops-join-global-freakout-over

    awesome. gun control might not be dead as a political tool, but as effective policy, it’s just about over. what good are background checks and mag limits going to do when I can build whatever I want in my basement.

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    • markinaustin's avatar
      markinaustin, on October 18, 2013 at 12:23 pm said:

      “Liberal Gentry” = Big city patronage? The Chi picture painted seems ugly. But its only connection to “liberal” is if you classify Emmanuel as one [I do]. The actual programs being criticized are ones that aid the affluent in preference to the poor, which is a standard liberal attack.

      Ignoring the poor to attract more business is an urban strategy that crosses party lines, as does waste.

      George, our TX cities are generally less wasteful than this, but we have sure had our share of tax giveaways to new businesses promising to move in. Perry wasted a bunch of his special fund for this sort of effort.

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  6. novahockey's avatar
    novahockey, on October 18, 2013 at 11:53 am said:

    The other day I suggested that the shutdown would help Paul, Rand as Cruz was seen as the RWNJ, while Paul was playing this better.

    And here, a few days later …..

    http://www.politico.com/story/2013/10/rand-paul-shows-softer-side-during-shutdown-98495.html

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  7. Fairlington Blade's avatar
    Fairlington Blade, on October 18, 2013 at 12:52 pm said:

    The liberal gentry ride bikes? Who knew? I’m a cyclocrat!

    BB

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    • ScottC's avatar
      ScottC, on October 18, 2013 at 1:07 pm said:

      36 years ago today:

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      • markinaustin's avatar
        markinaustin, on October 18, 2013 at 1:15 pm said:

        My only point is that I strongly suspect that you, as a believer in God, actually do accept the existence of what others describe as supernatural, even if you won’t call it that.

        This could well be (and I understand that you are not being snarky – this is exactly what I would say to me if I were trying to get me to explain what I cannot).

        I have often said I would not try to describe my own personal experiences in this area as definitive for anyone else. Prayer, btw, not email…

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    • markinaustin's avatar
      markinaustin, on October 18, 2013 at 1:08 pm said:

      That one looks easy. The patch fills the lake on Day 48, so it fills half the lake on Day 47. The question is a little off in that this would require the original patch to be 1/2^48 of the lake. Practically, it is more than half full after 47 days and then fills out the rest on the last day. A technically correct answer would be between 46 and 47 days.

      Is this then a paradox? For if the patch doubles in size each day it must be half full on the penultimate day, no?

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  8. Fairlington Blade's avatar
    Fairlington Blade, on October 18, 2013 at 1:18 pm said:

    It must be at least half full on the penultimate day or it wouldn’t be able to fill the lake the next day. Giving a little more thought, the patch must fill half the lake at some point on the 47th day and it will fill the lake 24 hours later. The patch presumably stops growing after that.

    This reminds me of a myth regarding chess. Here’s one version:

    Long time ago a king named Shihram ruled over India. He was a despot. Around this time a wise man invented the game of chess to show the king how important everybody is, who lives in his kingdom, even the smallest among them.

    The king on the chess board needs his queen, his rooks, bishops, knights and the pawns to survive. This is like in real life. The king should learn this.

    Shihram, the king, understood this very well and he liked this game very much and he became a chess player and ordered that this game should be played by everybody in his kingdom.

    The king was very thankful, let the wise man come and went with him to his treasures to give him gold and silver or other valuable things.

    “You are allowed to choose what you want!” he said to the man who invented chess. “I will give it to you!”

    The wise man thought for a while and said to the king. “I don’t desire any of your treasures. I have a special wish!” And then he went with the king to a chess board.

    “My wish is to get some wheat! Please put one grain of wheat on to the first chess square and two on to the second and keep doubling up the wheat until the last square!”

    The king became angry and shouted: “I have offered you all my treasures and you want just wheat? Do you want to offend me?”

    “Oh no!” said the wise man. “I don’t want to offend you, my king. Please respect my wish and you will see that my wish is truly great.”

    The king called his servants and ordered to put the wheat on the chess board exactly as the wise man wished. The servants brought a lot of wheat. It soon filled many rooms but they realized that they could not fulfill the wise man’s wish.

    They went to the king and said: “We are unable to fulfill the wise man’s wish.”

    “Why not?” asked the king angry.

    They answered: „All the wheat of your kingdom and all the wheat of other kingdoms is not enough to fulfill this wish.” The king realized that the wise man had given him a lesson again. He learned that you should never underestimate the small things in life.

    I heard a different variation where the servant saved the King’s daughter and was slain for his impertinence in asking for such a reward.

    BB

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  9. Fairlington Blade's avatar
    Fairlington Blade, on October 18, 2013 at 1:45 pm said:

    Incidentally, I decided to see how big that patch was to start. Let’s assume that it’s a circular lake, one mile in diameter. That gives you a final area of a hair over 2 million square meters. If the original patch was circular, it would be 135 microns in diameter, about the width of a human hair.

    If our patch continued to grow overland, it would cover the earth at some point on Day 76. Yowza.

    BB

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  11. jnc4p's avatar
    jnc4p, on October 18, 2013 at 2:28 pm said:

    Great Daily Kos piece on how Democrats lose elections by refusing to run candidates.

    “Conclusions: The Virginia House of Delegates will not turn blue in 2013. Let’s get that disappointing fact out of the way first. On the bright side, the Republicans only have downwards to go after 2013, and 2015 should be a year that the Democratic Party of Virginia needs to push HARD(the Virginia Senate elections will be in 2015 so that would be a great time to try to turn that body blue). The much-hyped Howard Dean effort seems to be all talk and no substance as their effect seems to be negligible. I am frustrated that Democrats or DFA did not see fit to run candidates in some district that Obama and/or Kaine won or came very close to winning. That is electoral malpractice and the worst instance was not running a Democrat in a frigging open seat”

    http://www.dailykos.com/story/2013/04/11/1197965/-A-look-at-the-2013-Virginia-House-of-Delegates-Elections

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  12. novahockey's avatar
    novahockey, on October 18, 2013 at 2:48 pm said:

    Hi JNC — Is anyone you know excited about the gubernatorial race. My neighborhood is deep blue, and I’ve seen all of 2-3 signs for McAufflie.

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  13. jnc4p's avatar
    jnc4p, on October 18, 2013 at 2:57 pm said:

    Just the Sarvis supporters.

    Actually, I take that back. I know quite a few Democrats who are looking forward to:

    1. Voting against Cuccinelli
    2. Winning.

    The fact that McAuliffe is the instrument with which to do so is secondary to them.

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  14. novahockey's avatar
    novahockey, on October 18, 2013 at 3:10 pm said:

    gridlock it is.

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  15. novahockey's avatar
    novahockey, on October 18, 2013 at 3:10 pm said:

    i’m hoping sarvis can crack 10%

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  17. jnc4p's avatar
    jnc4p, on October 19, 2013 at 8:48 am said:

    Your future looks pretty bright NoVA.

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  18. Michigoose's avatar
    Michigoose, on October 19, 2013 at 11:30 am said:

    The Republicans in MD can despair; I got my voter ID in the mail today.

    Now for the liberal takeover!

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  20. Let the mutherfuker burn!'s avatar
    Troll McWingnut or George, whichever, on October 19, 2013 at 12:14 pm said:

    And everyone of those words rang true and glowed like burning coal

    Pouring off of every page like it was written in my soul from me to you

    http://www.dailykos.com/story/2013/10/15/1247463/-Maddow-Said-It-Sedition

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  22. Brent Nyitray's avatar
    Brent Nyitray, on October 19, 2013 at 2:54 pm said:

    “Well, in truth I call myself a “Urban Guerilla.””

    The tolerant left in action…

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  23. Michigoose's avatar
    Michigoose, on October 19, 2013 at 4:08 pm said:

    Hey, Brent. I’m Tolerant Left.

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  24. Brent Nyitray's avatar
    Brent Nyitray, on October 19, 2013 at 6:13 pm said:

    Yes, Michi you are…

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  26. novahockey's avatar
    novahockey, on October 21, 2013 at 8:08 am said:

    I saw Gravity too, Mark. My wife remarked that she had a hard time believe that it was not actually filmed in space. I was hesitant about the 3D screening, but it was fantastic.

    and Michi — you’re just running up the score in MD.

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