|US dollar index||86.4||-0.2|
|10 Year Govt Bond Yield||1.64%|
|Current Coupon Fannie Mae TBA||103.3|
|Current Coupon Ginnie Mae TBA||104.2|
|30 Year Fixed Rate Mortgage||3.49|
Stocks are up this morning on no real news. Bonds and MBS are down.
Slow news day, with no economic data.
Economic confidence improved slightly in September, according to Gallup.
Former Minneapolis Fed Head Narayana Kochlerakota discusses why people feel like the economy is struggling. Per-capita GDP growth is coming in around the high single-digits over a period of 10 years. Historically, that number has been much higher. The US economy has had “lost decades” like this before (basically the 1950s and the 1970s), and growth eventually rebounded. Unsurprisingly, he calls for higher inflation, and further monetary and fiscal stimulus.
Interesting comparison between the peak of the housing bubble and labor today. In both situations, investors and employers aren’t seeing the ground shift underneath them. The piece also included a chart of housing supply over the past 16 years. Believe it or not, we still have more inventory than we did in the early bubble days, although I wonder how much of this supply consists of abandoned homes that are uninhabitable.
Home prices increased 6.2% YOY according to CoreLogic. This puts home prices at about 6% below the 2006 peak. Increasing prices combined with stagnant incomes is creating an affordability crisis.