Morning Report – Another slow week on tap 5/12/14

Vital Statistics:

Last Change Percent
S&P Futures 1880.2 6.8 0.36%
Eurostoxx Index 3200.2 16.1 0.51%
Oil (WTI) 100.4 0.4 0.44%
LIBOR 0.225 0.001 0.45%
US Dollar Index (DXY) 79.8 -0.103 -0.13%
10 Year Govt Bond Yield 2.64% 0.02%
Current Coupon Ginnie Mae TBA 106 -0.1
Current Coupon Fannie Mae TBA 104.8 -0.1
BankRate 30 Year Fixed Rate Mortgage 4.22


Markets are higher this morning on strength in commodity prices. Bonds and MBS are down small.
No economic data this morning – we should get delinquencies and foreclosures from the MBA sometime this week. Tomorrow will probably have the most important data for the bond market with retail sales. The Street is expecting a .4% increase in the headline number. We get some inflation data with the CPI and the PPI this week, but inflation isn’t going to move the markets. Finally on Friday we get housing starts and building permits. I feel like Linus in the pumpkin patch waiting for my 1.5 million housing starts print, which has been normalcy over the past 50 years.
Of course the fly in the ointment for housing starts are the Millennial generation, which is depressing household formation and labor mobility. Workers are risk averse and unwilling to move given that companies no longer are willing to pay relocation costs, or even to fly applicants out for an interview. You end up in a situation where you have labor shortages and labor gluts. Of course this dynamic will change once the economy starts moving again, but this is yet another headwind.
Bill Gross cut his holdings of MBS in his Total Return Fund from 23% to 19%. He upped exposure to U.S. corporates and emerging markets debt. Duration was reduced to 4.73 years. This looks like a modest bet on economic strengthening. Separately, Atlanta Fed Head Dennis Lockhart says the economy should hit 3% growth in Q2.

25 Responses

  1. Frist.

    That is all.


  2. Another reason we’re all fucked.


  3. Scott: doesn’t open for a pinko leftie, either.


  4. Nope, can’t open either. I blame AGW. Gaia’s angry my friend.


  5. I Blame Obama™.


  6. Clearly Ace ran afoul of FCC content censors.


  7. Traveling for work this week. Posting will be sporadic & sparse.


  8. Traveling for work this week. Posting will be sporadic & sparse.

    That’s bullshit, bush league behavior. If you don’t comment every 15 minutes your banned.

    And fined.


  9. I swear even leftists cannot sell Unionization.

    Why would anybody want to collectively bargain?


  10. Hmmmmm.


    • McWing:

      If “white privilege” is something I’m born w, and didn’t choose to have, shouldn’t the gov be protecting me from bigotry and discrimination?—

      That is outstanding. But of course we know that the equal protection clause doesn’t actually mean equal protection. It means special protection for certain so-called suspect classifications. And white is not one.

      We live in increasingly Orwellian times. All animal are equal, but some are more equal than others.


  11. This is the blog written by the guy who did our photography for us Saturday at the Race for the Cure Utah. This is, quite possibly, the best coverage I’ve ever seen of our event.


  12. This is an interesting reversal of attitude. I actually welcome it but I doubt it will convince some of the guys I argued these Voter ID Laws with.

    Nine months later, [Rand] Paul is saying of voter ID laws,: “It’s wrong for Republicans to go too crazy on this issue because it’s offending people.” He’s conceded that Republicans have “over-emphasized” the prevalence of voter fraud and has called cutting early voting hours “a mistake.”

    Paul’s new religion on voting rights is evidence of a broader shift on the issue. In recent weeks, courts in Wisconsin and Arkansas have struck down voter ID laws and Pennsylvania Governor Tom Corbett decided not to appeal a Commonwealth Court decision in January overturning his state’s voter ID law. Extensive rulings in Wisconsin and Pennsylvania have strongly undercut the case for voter ID laws, showing that hundreds of thousands of registered voters lack the specific forms of newly required government-issued ID, that these voters are disproportionately black and Hispanic and lower-income, that obtaining such ID can be a Kafkaesque bureaucratic nightmare, and that there is no evidence of voter impersonation to justify such burdens. As Judge Lynn Adelman wrote in Wisconsin, “It is absolutely clear that [voter ID] will prevent more legitimate votes from being cast than fraudulent votes.” (A two-year investigation into voter fraud in Iowa found zero cases of voter impersonation at the polls.)


    • lms:

      This is an interesting reversal of attitude.

      It sounds to me like it’s mostly just a political calculation. And outside of a determination that they will impact one party over another, I still don’t understand the objection to ID requirements. People need an ID to do the most trivial of things nowadays.

      BTW, if having to show ID is overly burdensome, isn’t the requirement to be registered in the first place even more burdensome? If a polling place turns someone away just because they aren’t registered, hasn’t that person been just as disenfranchised as the person who is turned away because they don’t have an ID?


      • Check out the Federal Voter Registration form. From page 2:

        If you are registering to vote for the first time in your jurisdiction and are mailing this registration application, Federal law requires you to show proof of identification the first time you vote.

        Why can the feds require ID, but the states can’t?


  13. Michi, thanks for posting the blog and photos from the Race. Very moving really to see so many of us who have been touched by the struggle against breast cancer. I have two more friends now who are just beginning their battle, both in their fifties. It’s almost become a rite of passage for women. Thanks for your efforts!


  14. Rand Paul is getting to the left of the rest of the R’s because of his (correct IMO) original Goldwater-like answer about the 1964 CRA.


  15. Mic drop.


    • McWing:

      If I understand college administrators correctly, colleges are hotbeds of racism and rape that everyone should be able to attend.

      They are big supporters of needs-blind r&r.



    In a haze these days
    I pull up to the stop light
    I can feel that something’s not right
    I can feel that someone’s blasting me with hate
    And bass
    Sendin’ dirty vibes my way
    ‘Cause my great great great great Grandad
    Made someones’ great great great great Grandaddies slaves
    It wasn’t my idea
    It wasn’t my idea
    Never was my idea

    I just drove to the store
    For some Preparation-H


  17. Is Preparation H some sort of dog whistle or is a need of it considered Privilege?



  18. access to it is the privilege.


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