Morning Report: Home Prices continue to rise 9/29/15

Markets are up this morning on good economic news overseas. Bonds and MBS are up small.

Slow news day.

Consumer Confidence increased to 103 in September from 101.3.

NAR is saying they expect TRID to delay closings by up to 15 days. There will undoubtedly be a learning curve for the industry. TRID is the biggest change to the industry since the implementation of Dodd-Frank. CFPB claims they will use discretion in not going after lenders who make mistakes but are making a good-faith effort to work within the rules.

NAR put out the list of the 20 hottest real estate markets. While some at the top are not surprising (San Francisco) some of the other names are more associated with the economic dumpster fires we saw as the collapse began. Cities like Stockton CA and Detroit MI are included in the 20 hottest markets.

Glencore (which used to be called Xstrata) is a Swiss commodity trader who has been subject to solvency rumors. The stock has gotten hammered over the past year (down over 80%) but is up big today after addressing market rumors about solvency problems. While real estate types don’t typically have to worry about what happens in the area of precious metals, energy, and ag, stress in these markets can spill over to the rest of the financial sector. What does this mean for LOs? Stress = lower interest rates.

Speaking of stress, mutual funds that mimic hedge fund strategies may find themselves wrapped around the axle if we have a period of stress. Hedge fund arbitrage strategies typically require leverage and often invest in illiquid assets. Hedge funds at least have quarterly redemptions, which makes it easier to exit positions if need be. Mutual funds have no wiggle room – they have to accept redemptions daily. This could get ugly if markets turn south.

13 Responses

  1. Frist! I guess I’m glad I bought my house in December!

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  2. ICYMI: Carl Icahn gets on his soapbox

    http://carlicahn.com/

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  3. NoVA, correct me if I’m wrong but the NYT Editorial page is completely deranged here:

    “Mr. Boehner is free of them now. And so now is his chance. In the days he has left, he can revive immigration reform. He can pass the large-scale, comprehensive overhaul that lawmakers had worked on for years, a bill that passed the Senate in 2013 with strong bipartisan support and could have been sent to President Obama’s desk but for the obduracy of the nativist right in the House and Mr. Boehner’s unwillingness to call a vote.”

    http://www.nytimes.com/2015/09/29/opinion/mr-boehners-october-miracle.html?ref=opinion

    That bill died with the last Congress, and there’s nothing that’s gone though the committees in the current Congress that Boehner could bring up for a vote, even if he wanted to, correct?

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  4. Pretty sure Reid never sent it to the House anyway, such was his level of commitment to immigration reform.

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  5. That bill did die. but the Speaker can do a lot, particularly if the rules committee plays ball.

    if he wanted to pass it, he could.

    here are six immigration bills that have been reported by committe.

    https://www.govtrack.us/congress/bills/subjects/immigration/6206#current_status%5B%5D=3

    if i wanted to pass it, here’s what i’d do.

    1. have rules committee report one of those immigration bills with an “Modified Closed Rule” … Permits general debate for a specified period of time, but limits amendments to those designated in the special rule or the Rules Committee report accompanying the special rule. May preclude amendments to particular portions of a bill.

    2. have your amendment (dead bill from last session) be specified as the as the the “designed” amendment in the rule. it wouldn’t be H.R 1 or whaterver. but House Amdt 50320 or whatever.

    3. approve the amendment.

    4. final passage.

    3 and 4 would require a ton of D votes. assuming all the Ds vote for it, you only need 30 R votes.

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  6. “Let the mutherfuker burn!, on September 29, 2015 at 11:03 am said:

    Pretty sure Reid never sent it to the House anyway, such was his level of commitment to immigration reform.”

    He did actually send it to the House in the last Congress, but anything the House passed this Congress would have to get through the Senate with the new partisan makeup.

    http://www.politico.com/story/2013/06/immigration-bill-2013-senate-passes-093530

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  7. J, not to be douchier than normal but your link was date June of 2013 and never mentions if the bill was sent over to the House, this link is over a year later (ll/14) and says the bill was never sent. I cannot find anything more recent though Jay Cost, Sean Trende and Phil Kerpen have all Tweeted recently that the Reid never sent the bill over.

    http://www.washingtontimes.com/news/2014/nov/17/senate-democrats-keep-own-immigration-bill-from-ho/?page=all

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  8. I didn’t realize that they hadn’t done that. At the time the expectation was that the House would pass it’s own version and they would go to conference.

    Edit: This seems to address it directly and shows that you are right. I thought that the Senate had gamed the origination issue the same way that they did with the PPACA by simply taking an unrelated House bill and replacing the language by amendment.

    http://cis.org/feere/journos-still-dont-understand-house-cannot-act-senate-amnesty-bill

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  9. As a pedant, I am now satisfied.

    I’ll make a helluva guard in the camps.

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  10. I’m nothing if not officious.

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  11. As if millions of lefty voices cried out in terror and were suddenly silenced.

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