Morning Report – All cash transactions drop to lowest level since 2009 9/14/22

Vital Statistics:

Last Change Percent
S&P Futures 1997.0 -6.8 -0.34%
Eurostoxx Index 3266.5 -6.8 -0.21%
Oil (WTI) 92.14 -0.3 -0.29%
LIBOR 0.233 0.000 0.00%
US Dollar Index (DXY) 84.67 -0.063 -0.07%
10 Year Govt Bond Yield 2.56% -0.01%
Current Coupon Ginnie Mae TBA 105.9 0.1
Current Coupon Fannie Mae TBA 105.2 0.1
BankRate 30 Year Fixed Rate Mortgage 4.23
Markets are higher this morning on no real news. Bonds and MBS are up.
Merger Monday continues apace, with a few big deals – Merck Kga is buying chemical giant Sigma-Aldrich, and Siemens agreed to buy Dresser-Rand.
Existing Home Sales came in at 5.05 million units, according to NAR. This is a 5.3% drop year-over-year. The median house price increased to $219,800 which is up 4.8%. All cash sales dropped to 23% of all transactions in August and represents the lowest share since December 2009. So, there is at least some good news for mortgage bankers. It looks like investors are stepping away from the market, which should pave the way for the first time homebuyer, who has been shut out due to bidding wars and the advantages of a cash buyer.
The Alibaba IPO went swimmingly, with $25 billion worth of stock being sold and the stock trading up 38% on the first day. The company now sports a valuation of $231 billion, which puts it in the same territory as JP Morgan and Chevron. Note that Chevron throws off about 10 times the EBITDA that BABA does.
The Chicago Fed National Activity Index slipped in August to -.21, We saw from the industrial production data that the auto sector had a huge July followed by a weak August.
Kansas’ state unemployment rate came in at 4.9%, well below the national average. For those who haven’t been following closely, Kansas has been quite the ideological football lately. The left has been assiduously trying to paint Kansas’s tax cut package as a dismal failure. Of course the idea was to attract companies to relocate to Kansas and that won’t happen overnight. Needless to say, there is an election coming up, and control of the Senate may hinge on Kansas.
We all know the housing sector continues to punch below its weight. One reason is student loan debt, which has the effect of depressing home sales by 8%, according to a new paper. That equates to about $83 billion in lost activity. We have discussed before the misconceptions regarding how to qualify for a mortgage. Separately, FHA loans fell 19% compared to a year ago as bankers pull away following an avalanche of lawsuits and buybacks. In fact, JP Morgan CEO Jamie Dimon said on his second quarter earnings conference call that the bank is wondering whether to be in the FHA business at all. Housing advocates are pushing for more low-income lending and are vexed that the banks are making less loans. now.

24 Responses

  1. MOAR Republican War on Women.

    Biden’s right,we need more Bob Packwoods!


  2. It is amazing how a (D) after your name gives you total immunity in the media…


    • Brent, I am guessing this will help the small cash investor in rental real estate. Right?


      • JNC, I need to be thinking about reservations. I want to send you some links and discuss time-and -distance. Rosanne is definitely in, as I assume is your libertarian significant other.

        Rather than screw up the threads, give me a contact point I can use. You can email me at the operamail address. I’ll look for it.



    I think should I ever run, i’ll just run as a D and then do whatever I want.


  4. Brent, I am guessing this will help the small cash investor in rental real estate. Right?

    I guess at the margin, yes. There are a lot of young people out there who believe you can’t get a mortgage without 20% down. FHA loans are targeted at the first time homebuyer and require only 3.5% down.


  5. Mark, I sent an E-mail to your G-mail address that I had.


  6. Brent, Evan Ace wants to help.


  7. Help is here.

    You just have to ask for it


  8. Everyone……………..we’re still super busy at work getting a couple of big orders out the door. The one headed to Taiwan is being picked up by the freight company tomorrow and the one for Australia on Wed………………then we’re heading out of town for a few days for a little R & R.

    Hopefully I’ll have a little more time to contribute next week……………….although I AM still working on our taxes so we can file Oct.15………………..yikes.

    McWing, thought I’d let you know I have a new trainer at the gym and he is an Ex-Marine…………………or are Marines always Marines and never Ex’s? Anyway, I think he thinks I’m a new recruit or something…………….he’s killing me!


  9. And you are paying him to do so lmsinca.

    Glad you have some big orders to deal with. Those are good problems to have.


  10. Heh. I guess once a Marine always a Marine.


  11. Like

  12. I would’ve died for that right like she died for mine.


  13. jnc

    And you are paying him to do so lmsinca.

    Hah, very true……………….I’m an idiot then!

    Have a nice day everyone…………………see you on the other side again!


  14. I once had a trainer who was a Marine. He was .. intense and though all you needed to get in shape was unlimited push ups. . a lot of current and former military at my crossfit gym (which is called a box in the lingo). one of them is active duty Army officer. super nice, but she’s a close talker. gets about an inch from your nose. i don’t know if its an army thing or what.


  15. My new training motto is,

    “What doesn’t kill you makes you stronger”

    (in my best Kelly Clarkson voice);)

    He’s a nice guy and doesn’t think I’ve been working to my potential. I did 440lb (counting the face plate and bar) angled leg press for the first time today…………………only 3 reps but I did it. My other trainer was more focused on rehabbing my back, which probably should have ended about 6 months ago and now he’s increasing the intensity and the weight………..but I still swim afterwards……………..;)


  16. that’s awesome, lms. keep up the good work.


  17. keep up the good work.

    It’s fun and keeps me busy and also gets me away from my desk for a couple of hours 5 days a week.


    • 440 is awesome. If I do 360 my right knee hurts so I do my 3×15 reps at 315/320. I think I would rip a knee at 440 and I could only do it for a short extension. He who shall not be named [Seattle to Viet Nam] claimed he did 1700#.

      I haven’t been doing upper body work for the last five years because of what I think is a torn rotator cuff in my right shoulder. I am finally getting a personal trainer to show me how to work around it.


  18. He who shall not be named [Seattle to Viet Nam] claimed he did 1700#.

    Let’s assume the bar is 100 pounds. You would still need thirty-five 45lb plates to get to 1700 pounds. or sixteen 100 pound plates. BS.


  19. Mark, luckily for me my knees and shoulders are in great shape. My back was my problem for the last 8 years but it doesn’t ever even hurt anymore…………….so happy about that. I don’t take aspirin anymore and my stomach thanks me for it. I take one tylenol pm at night and vitamins and supplements and that’s it……………pretty good for a 64 year old I think. I feel as strong and healthy as I felt in my 30’s and 40’s. It’s amazing what a good diet and exercise routine can do for us old folks (and a good trainer).

    Now, if the wrinkles would go away on their own……………….I’d be perfect………hahaha

    Edit, Mark I worked my way up to that weight today with more reps (starting with 15 @ 180 lbs) and then gradually increased weight and lowered reps. I definitely felt the 440 today but I think I could work up to more eventually. My new trainer is totally into weight lifting for females so I’m really happy about that, and so far he hasn’t made me do any PUSHUPS!


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