Brent Nyitray
Fairlington Blade
Let the mutherfuker burn!
jnc4p
Kevin S. Willis
Michigoose
lmsinca
markinaustin
Arcanaut
novahockey
quarterback
ScottC
yellojktVital Statistics:
| Last | Change | Percent | |
| S&P Futures | 1931.2 | 5.5 | 0.29% |
| Eurostoxx Index | 3285.1 | 47.2 | 1.46% |
| Oil (WTI) | 102.4 | -0.3 | -0.27% |
| LIBOR | 0.231 | 0.001 | 0.48% |
| US Dollar Index (DXY) | 80.94 | 0.281 | 0.35% |
| 10 Year Govt Bond Yield | 2.61% | 0.01% | |
| Current Coupon Ginnie Mae TBA | 106.3 | 0.0 | |
| Current Coupon Fannie Mae TBA | 105.3 | -0.1 | |
| BankRate 30 Year Fixed Rate Mortgage | 4.2 |
Markets are higher this morning after the European Central Bank took some unprecedented stimulus measures. Bonds and MBS are down small, rebounding after an initial sell-off on the ECB’s actions.
The ECB, fearing deflation, cut its deposit rate to -.1%, which means you have to pay to invest your money at the central bank. They are also lowered the benchmark rate to .15% from .25%. The ECB hasn’t ruled out quantitative easing, but the fact that there is no “Euro” sovereign bond complicates things. How will this affect US rates? Hard to tell, but at the margin, it will be dollar positive / euro negative which would be US bond bullish. That said, the direction of US bonds will undoubtedly be driven by tomorrow’s jobs report more than anything.
In economic data this morning, announced job cuts increased 45.5% to 53,000 in May, according to outplacement firm Challenger, Gray and Christmas. Hewlett-Packard largely drove the increase with a plan to cut payrolls by almost 19,000. Transportation, Health Care, Government, and Services rounded out the other job cuts. This is the highest number in 15 months. It is important to distinguish between job cuts and job losses – these numbers come from company press releases, which often never materialize as market conditions change. Second, often these reductions are done by attrition.
Initial Jobless Claims came in at 312,000, another decent number. Later on today, we will get the Household change in net worth from the Fed. This is not going to necessarily be a market-moving number, but changes in it should drive consumption going forward.
The McArthur Foundation released a survey of Americans’ attitudes about housing. The McArthur Foundation leans left, so the survey focuses on lower-income housing issues and slices and dices according to demographics. The punch line from the survey is that most people think affordable housing is hard to come by, and that we are still in the middle of the crisis. However, the biggest conclusion is that homeownership is not viewed as the vehicle to building wealth that it once was, and the public believes that renting has grown in appeal while owning has declined. That said, 70% of non-owners do aspire to own a home, and luckily the age 18-34 cohort – the classic first-time homebuyer – is most keen on owning a home. Only 44% of non-owners over 50 desire to buy a home. A full 2/3 of the public believes it is less likely today than it was 20 or 30 years ago to build equity and wealth through home ownership. Again, we are exiting a once-in-several-generation housing bust and many people who levered up too much / bought more house than they could afford are going to be gun shy. This survey, however speaks to the challenge for many in the mortgage industry – how to change attitudes about housing. We have a housing shortage in this country and home prices / mortgage rates are still highly affordable. Yes housing was a terrible bet in 2005 – 2009. But it isn’t 2005 anymore.
Filed under: Morning Report |
All Things in Moderation 
Thanks 52%!
http://www.thegatewaypundit.com/2014/06/wow-obama-administration-official-bergdahl-worthy-of-sympathy-if-he-joined-taliban-to-protest-psychopath-platoon-leaders/
Boy, Obama’s got an eye for talent!
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OT, but interesting story about the junk science behind low fat diets and governmental grants afterward…
http://online.wsj.com/articles/book-review-the-big-fat-surprise-by-nina-techolz-1401923948
#settledscience
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Brent:
OT, but interesting story about the junk science behind low fat diets and governmental grants afterward…
I read that this morning on the train. I want to get the book.
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Presumably this will be spun as a positive by the administration:
“One in five Americans is now on Medicaid
Updated by Sarah Kliff on June 4, 2014, 4:10 p.m. ET”
http://www.vox.com/2014/6/4/5780024/one-in-five-americans-are-now-on-medicaid
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I can’t access the WSJ but I have been reading a lot about the benefits of the right kind and amount of fat. I may look into purchasing the kindle version. Not sure what the government grants are about but I’m sure it’s bad, everything the government is involved in is, apparently.
I’ve been reading “New Rules of Lifting For Women” and have been learning the benefits of protein. My diet consists of about 40% carbs, 30% protein and 30% healthy fats. I’ve been able, until the last three weeks, to build muscle and either maintain or gain a few pounds doing this and I’m much stronger than I was last year. I’m anxious to get back to the gym (maybe cleared by tomorrow) and try some of this out, although I think I already do quite a bit of the recommended lifting as my trainer believes in women lifting heavy things.
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lms:
Not sure what the government grants are about but I’m sure it’s bad, everything the government is involved in is, apparently.
Now you’re talking.
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Scott, I knew you’d like that, but it was actually directed at the “bridesmaid”.
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lms:
Well, if I thought you really meant it, I could die a little bit happier. The words of the great Ronald Reagan, who died 10 years ago today, are more true now than ever before.
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My ears are turning red.
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Brent, we’re still waiting for the final quote from the company we’ve chosen to do our solar. The big decision is whether to buy or lease I guess but I think we’ve decided in our case it’s better to own the equipment because of running the business here. We’ll get the same tax incentive (30%) but will be able to write off some of the cost and some depreciation through the business. The only drawback that I can see is only a10 year warranty vs 20 on the inverter. It will go out before the 20 years they say. I doubt I’ll still be here, at least in this house, by then though…………..LOL
The other question is how much do we put down considering we’re getting 2.9% financing? We’d like to pay it off sooner rather than later though, so we can actually have no electric bill once we retire or as an added benefit when we sell. Any suggestions on that? I don’t have the final number yet, but somewhere between $25k and $30k it looks like. Part of it depends on whether we put it on the roof of our home or the roof of the warehouse.
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LOL Scott.
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Uh…
http://www.dailymail.co.uk/news/article-2648846/Pentagon-sources-Obama-ignored-two-chances-rescue-Bergdahl-ground-WANTED-terror-trade-help-close-Guantanamo-Bay.html
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Paul Waldman over at PL comes clean:
Yes they lied, yes it was intentional, yes the goal is to socialize medicine.
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jnc:
Yes they lied, yes it was intentional, yes the goal is to socialize medicine.
Isn't that what I have been saying since the birth of ATiM? Hopefully it no longer sounds too much like 11th dimensional chess.
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Tribe, on the Roberts Court, an excerpt:
First, the Health-Care Case. In his controlling opinion, Roberts, joined not just by the four other right-leaning justices but also by Justices Stephen Breyer and Elena Kagan, struck down federal power to coerce states into expanding Medicaid to cover millions more people at mostly federal expense, even as he upheld federal power to offer states that option. At the same time, joined only by the four other conservatives, he invalidated the “individual mandate” to the extent it coerced the purchase of health insurance, even as he upheld the “mandate” as a tax penalty that really just encouraged participation in the insurance market.
Although the Medicaid ruling has been seen as a defeat for President Obama, the Affordable Care Act and the Democratic Party, whereas the ruling upholding the mandate has been seen as a win for those same groups, of more lasting importance is the overarching theme those rulings had in common. The Constitution as interpreted by the Roberts Court, which displays a clear libertarian impulse, frowns on government using the power to coerce. It does so by increasingly tilting the constitutional playing field in favor of choice-respecting forms of regulation. Government may (relatively) freely encourage, influence, and sometimes even bribe, but faces much sharper limits when it tries to force certain kinds of conduct. This is an important principle, although how it will apply elsewhere remains deeply uncertain.
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Mark:
At the same time, joined only by the four other conservatives, he invalidated the “individual mandate” to the extent it coerced the purchase of health insurance, even as he upheld the “mandate” as a tax penalty that really just encouraged participation in the insurance market.
Tax penalty? I thought the decision actually hinged on whether it was one or the other. Didn’t Roberts rule that, despite the fact that the law calls it a “penalty”, it wasn’t really a penalty, but was a tax instead, and that is what made it acceptable?
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Yes.
…the shared responsibility payment may for constitutional purposes be considered a tax. The payment is not so high that there is really no choice but to buy health insurance; the payment is not limited to willful violations, as penalties for unlawful acts often are; and the payment is collected solely by the IRS through the normal means of taxation.
[citation omitted]
None of this is to say that payment is not intended to induce the purchase of health insurance. But the mandate need not be read to declare that failing to do so is unlawful. Neither the Affordable Care Act nor any other law attaches negative legal consequences to not buying health insurance, beyond requiring a payment to the IRS. And Congress’s choice of language stating that individuals shall obtain insurance or pay a penalty does not require reading §5000A as punishing unlawful conduct. It may also be read as imposing a tax on those who go without insurance. [citation omitted]
Scott, the interesting point remains, despite Tribe’s awkward insertion of the word “penalty”:
this Court seems on a path that gives a certain amount of leeway to the fed to encourage and influence conduct, while tending to draw a “bright line” at overt coercion. I think there is something to that observation, but to the extent that it is correct the predictive value for a practitioner or the lower court judge becomes hard to winnow.
Lower court judges especially like Bright Lines.
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Worth remembering….today is the 70th anniversary of D-day.
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Mark:
this Court seems on a path that gives a certain amount of leeway to the fed to encourage and influence conduct, while tending to draw a “bright line” at overt coercion.
It’s interesting to me that, while if true, it seems to be a path that is desired by only 1 or 2 justices. There is a coalition of judges which would give the government a huge amount of leeway to coerce, and another coalition that, I think, would restrict even its ability to “encourage” behavior. The one or two guys willing to split the baby seem to be dictating the course of the court.
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Yeah us.
How can one support this given the shithole the VA was/is/will always be?
What does the Federal government do well?
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Oh yeah, the EU’s totally out of the woods.
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Now it’s a phony scandal.
Who had 72 hours?
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I thought the upshot of the mandate was that the tax couldn’t be punitive If so, does that mean the tax couldn’t ever be higher then what an exchange insurance policy costs?
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given the shithole the VA was/is/will always be
This is the wonderful sort of insight that we always get from you, Troll.
It’s a wonder you don’t have more people beating a path to your door anticipating your bon mots.
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Brent, in the reporting on the SEC attention to flash traders I did not hear if co-location was going to be banned. I did not hear if selling access to dark pools was going to be banned. Without these steps, favoring a group of inside traders continues.
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I have had friends whom I visited in the VA Hosps in Temple and in Dallas.
Both were unlike civilian hospitals in a good way. There is lots of group activity aimed at healing which you could not get easily from a group of random civilians. The patients without mental or emotional problems seem more interested in getting better than patients in other hospitals. There is a lot more ambulatory care inside the hospitals. Patients are treated like adults.
You asked me, George, what good is VA and I told you I knew guys who were treated well. I just thought I’d add these observations.
I also know how difficult it was to get an appointment. There is no excuse for falsifying records. I don;t think that was going on at the caregiver level.
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Brent –
Will flash traders be denied co-location and paid access to dark pools?
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I’m a giver.
You’re welcome.
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