Bits & Pieces (Friday Morning Open Mic)

Posted on September 14, 2012 by Kevin S. Willis

Mitt Romney is looking like a better candidate all the time.

For everyone who ever wondered where the heck some of Superman’s powers came from in Superman II:

Seriously? Super-Kiss? The ability to pull the S off his chest and make it a big cellophane wrapper? And the bad guys “finger beams”? Where are Kryptonian “finger-beams” in the Superman canon?

Susan Solomon chats up stem cells at TED. She brings up Vioxx, a longstanding pharmaceutical bugaboo of mine. Vioxx, for many users, was a miracle drug. For a significant minority of users, it killed them. So, instead of changing the prescription and treatment model, they recalled the drug and took it off the market. Apparently, researching drugs with stem cell cultures could allow us to identify where certain people would be helped and others would die with the use of a drug. That would be a good thing, I would think.

•••

Is Obesity the Greatest Threat To Our National Security? It’s not a good thing, I know. I’ve recently lost 70 lbs myself, and it’s better being thin than fat, all things considered. But I’m not sure I’ve improved our national security by doing so a single iota. I believe this may be hyperbole.

At least we know the Obama’s aren’t pandering to the fat vote. Although I’m not sure that’s politically smart, given how many of them there are.

Do tax cuts for the rich help the economy? Some say no.

•••

Is romance and lots of support and loving and no expectation of anything in return? Not according to Athol Kay on his blog (Married Man Sex Life), and not according to his multitudes of readers, and advice seekers, on the forums of said blog. It can be eye opening, yet I’ve found my experience dovetails with much of what I read.

Being a jerk doesn’t necessarily lead to a great marriage, but being nice and sweet and supportive (at least, for the guy) definitely doesn’t lead there, either. If you’re a hyper-supportive beta-male (like me), you might think it’s just your situation, but apparently it’s played out again and again and again in marriages across the world:

Boy meets girl, boy and girl get married, guy is super-supportive and tries to be romantic and sweet, girl loses attraction, sex practically vanishes. Girl tells boy he needs to be more supportive and nicer and possibly richer and also more obedient and then she will find him more attractive. Boy tries to comply, girl becomes more distant, more nagging, more shrewish, less affectionate, sex disappears completely.

Then, if you read the stories, girl, as often as not, takes her love to town, cuckolds her husband, and then when her adultery is finally discovered, blames him and tries to arrange it so she can have her cake and eat it too (exciting lover and poor beta-husband’s wallet). I haven’t exactly experienced that, but it’s pretty clear lots of guys do. Don’t go searching for Talk About Marriage unless you want to be deeply, deeply depressed.

The answer? Guys need to be men, the captains of their ship, and step up to the plate and have some balls. Turns out, neither Oprah nor Doctor Phil, and not even John Gray (although I devoured his stuff in my late 20s, early 30s, with pretty much zero benefit) have the right advice for men. The right advice turns out to be: man up, and don’t put up with bullshit. Who knew?

Don’t even get me started on the Manosphere. They definitely don’t like the womyn much, or our feminized culture.

•••

I meant to post this yesterday in celebration of ATiM’s anniversary. However, life gets in the way. Since I did not, I get to share this experience:

Coming back from my daughter’s dance class last, I went through a DUI checkpoint that was like nothing I’d ever seen. They randomly picked a stretch of road about a block long, shut off two lanes on either side so all traffic had to be funneled through one lane. There were about 20 officers in the road, about 50 or 60 on the sides, some of them probably technicians or other support people. Along one side there were five or six cruisers with their bars lit, on the other side there were about 25. Going through it, they checked my tags, asked me where I was going, checked my license (checked the cup holders, natch, looking for open containers), and made sure I and my little girl were properly seat-belted.

They were polite as could be, but it was an odd experience. I can’t imagine the open container and seat belt citations could possible pay for a quarter of the expense of such a large operation. There was too much time for seeing the enormity of the stake out and actually getting there for folks not to have plenty of opportunity to put their seat belts on and hide any open containers; they’d have to be actively drunk, and seriously so, to get caught. I heard officers complaining that they’d checked over 40 cars and got nothing. Then I heard another say he saw an open container, but the guy had zoomed on out and gotten away. Nearly 30 cruisers, bars lit, and no one sitting by to chase down a fleeing violator.

Very strange.

Filed under: Bits and Pieces, Mitt Romney | Tagged: , , | 14 Comments »

Morning Report 9/14/12

Posted on September 14, 2012 by Brent Nyitray

Vital Statistics:

  Last Change Percent
S&P Futures  1456.8 6.4 0.44%
Eurostoxx Index 2592.6 49.3 1.94%
Oil (WTI) 99.66 1.3 1.37%
LIBOR 0.385 -0.004 -0.90%
US Dollar Index (DXY) 78.9 -0.366 -0.46%
10 Year Govt Bond Yield 1.82% 0.10%  
RPX Composite Real Estate Index 193.7 0.3  

 

Welcome to the world of QEU (QE Unlimited). Markets worldwide rocketed on the Fed’s decision and the rally continues this morning. Commodities have a bid, while bonds and down a point and MBS are flat, continuing the divergence that began on the announcement. 

In economic data, the Consumer Price Index (which became officially irrelevant yesterday) came in at +.6% and retail sales data came in a little better than expected, though higher gas prices may have been driving that number. The dollar continued to weaken against the euro.

The Fed’s announcement had opposite effects on Treasuries and MBS.  Treasuries sold off 2 points on the announcement, while MBS gained a point. While Treasuries did recoup some of their losses, MBS went out at the highs of the day. This puts the 30 year Fixed Best-Ex rate somewhere between 3 3/8% and 3 1/2%. The NY Fed has the particulars on the MBS purchases.

Former Fed Governor Kevin Warsh told CNBC that the Fed’s action reflects deep concerns that the economy is at stall speed or worse. He also noted that the iPhone 5 would have more of an effect on the economy than QE.  Someone else made the same point, and took it further by saying if you believe that incremental consumer spending is good for the economy then you must support the New Deal II. 

The FHFA is developing a new securitization platform as a way to let other lenders compete with Fan and Fred in the secondary market and to reduce the GSEs role in the mortgage markets overall.

Filed under: Morning Report | 58 Comments »

Morning Report 9/13/12

Posted on September 13, 2012 by Brent Nyitray

Vital Statistics:

  Last Change Percent
S&P Futures  1437.0 -2.5 -0.17%
Eurostoxx Index 2546.8 -18.0 -0.70%
Oil (WTI) 97.32 0.3 0.32%
LIBOR 0.389 -0.006 -1.40%
US Dollar Index (DXY) 79.67 -0.071 -0.09%
10 Year Govt Bond Yield 1.73% -0.02%  
RPX Composite Real Estate Index 193.4 0.3  

Markets are lower this morning after initial jobless claims ticked up to 382k and the Producer Price Index showed inflation in check. All eyes turn to the FOMC decision scheduled for 12:30 est. Here is the summary of what to look for. Bonds and MBS are both stronger.

Fannie Mae’s latest issue of Housing Insights does a deep dive into the latest employment statistics. While average weekly earnings have rebounded from the recession, aggregate weekly earnings have not. What did Keynes say about “sticky wages?”  What this means is that wages have recovered for the people that have jobs, but is you add up everyone’s salaries, that number has not. Which pretty much tells us what we already know – wages are flattish and unemployment is high. They blame the construction sector for the weakness.  As I have said before, we have under-built housing for the past 10 years. Tight credit and temporarily depressed housing formation has masked the effect on housing demand. That won’t last forever.

Census points out that median income fell 1.5% in the last two years. Interestingly 2010 was the peak of average or median wages and they have been falling ever since. The two reports do disagree somewhat – Fannie has average wages up about 2% since the recession began, while census shows them 8.1% lower. Both adjust for inflation, and I cannot imagine the difference between median and average would be that great, so I am not sure what is going on there.  Census also notes the income gap is widening, so expect the study to be political fodder.

Rob Chrisman dissects the recent G-fee increase and its effect on the mortgage market. RTWT.

Is the rental boom reaching the end of the line? Maybe in Manhattan.

Filed under: Morning Report | 97 Comments »

Happy Anniversary, ATiM

Posted on September 13, 2012 by ScottC

Today is ATiM’s first anniversary, and I think a hearty congratulations are in order, both for the site and for everyone involved in making it the success it has become.

Success, of course, was (and, if we are honest, remains) not assured. Bringing together strong personalities with passionate opinions from as wide a range of ideologies and perspectives as we have here to discuss political issues was always a risky prospect. And while many blogs survive and thrive on the combustible energy and oftentimes unpleasant atmosphere created by such a diverse mix of opinions, from the beginning All Things in Moderation was, as the name implies, intended to be something different. As I wrote in What ATiM is All About, “we created ATiM as a place where political discussion and debate can take place in the absence of the kind of unproductive vitriol that has come to characterize much of blog commentary these days.”

Naturally, we’ve (and especially I’ve) not always succeeded. We lost a few early invitees almost immediately, and a couple more along the way. We’ve had our share of sharp and pissed off exchanges, and a couple of times it seemed, to me at least, like the whole enterprise was going to collapse. But here we still are, going strong, and a lot more positive than negative to show for it.

On a personal level, I truly appreciate ATiM. I have long been a political blog junkie and have been posting on comment boards since I first discovered them over 15 years ago. I’ve jumped from place to place, and had spent the two years prior to ATiM’s inception posting at Greg Sargent’s Plum Line. It had become an extremely unpleasant place to be, but I hung around primarily because of some of the relationships I had developed while there, notably with QB, McWing, and lms. ATiM has allowed me to maintain those relationships, and develop others I never would have, outside of the cesspool that is the Plum Line. I know many of you still participate there, but I for one am thankful that I have no more reason to visit there anymore.

I want to send out a couple of personal thank you’s on this first anniversary. First, to Brent, who’s Morning Report has been crucial to ATiM’s continued existence. I truly believe that without his daily efforts ATiM probably would have died more than once over the last year. He is the unsung hero of ATiM. Also to Mark and Kevin for their efforts at getting ATiM started, Mark behind the scenes recruiting and Kevin for being the technical genius at actually creating the site itself. (I also miss Kevin’s daily Bits n Pieces). And finally, a big thanks to lms. She was the catalyst that got ATiM off the ground. If I am not mistaken, lms and I were debating each other at the Plum Line for longer than anyone else here (except for possibly QB), and given the tone of some of those debates (one early one resulted in lms literally telling me she hated me), she could easily have chosen to leave me out. But she didn’t and for that I am eternally grateful. Here’s to hoping for a lot more debates in the future, lms.

Happy anniversary, ATiM.

ScottC

(Please feel free to add your own anniversary thoughts to the bottom of this post, if you don’t want to make your own new post.)

Filed under: administrative, Birthdays, lmsinca's folly | 23 Comments »

Morning Report 9/12/12

Posted on September 12, 2012 by Brent Nyitray

Vital Statistics:

  Last Change Percent
S&P Futures  1435.8 5.2 0.36%
Eurostoxx Index 2568.4 10.7 0.42%
Oil (WTI) 97.4 0.2 0.24%
LIBOR 0.394 -0.005 -1.13%
US Dollar Index (DXY) 79.74 -0.113 -0.14%
10 Year Govt Bond Yield 1.74% 0.03%  
RPX Composite Real Estate Index 193.2 0.1  

Markets are buoyant this morning after a German Court ruled against efforts to block a european rescue fund. Apple is unveiling the iPhone 5 today as well. Mortgage applications rose, while import prices fell. Bonds are down about 3/4 of a point and MBS are down 1/4 or so.

The FOMC starts their two day meeting today, and will release their decision tomorrow around noon. The market expectations are for an extension of ZIRP into 2015 and a new round of bond buying. Given the run we have had in the stock market, we are possibly setting ourselves up for disappointment or a “buy the rumor, sell the fact” reaction.  

If you live in a state with judicial foreclosures (e.g. New York, New Jersey, Florida), you may find that it will cost you more to get a mortgage. Acting FHFA Chairman Ed DeMarco has suggested that Fan and Fred increase their guarantee fees in these states to compensate the fund for the elongated timelines. (It can take 5 years to complete the entire process in NY, while in non-judicial states like AZ the process can be done in 2).  JP Morgan estimates that the proper compensation would be 10 – 20 basis points up front. FHFA intends to put the policy out for comment in the near future, where it will undoubtedly get panned by housing advocates.

WaPo has a long background piece on the CFPB and what it is up to (spraying lenders with subpoenas).

Foreclosure auctions are attracting big institutional money.  Colony, Blackstone, Och-Ziff and Oaktree have raised $8 billion for the activity. The plan is to rent them out of drip them out slowly into a rising housing market. In an era of ZIRP, high single digit rental yields are appealing to yield starved investors.

Filed under: Morning Report | 168 Comments »

WHERE WERE YOU?

Posted on September 11, 2012 by markinaustin

I was eating breakfast in Nau’s Pharmacy in Austin. The TV was on behind the counter. A moment of consternation. I looked up. The tail of an airliner was sticking out of one of the WTC towers. The next hour passed in a fog. No one left for work. We talked quietly among ourselves. We shed tears. We knew war would follow.

In the days that followed, I learned that my bro-in-law had been making an engineering presentation in Manhattan in the 30s and the building he was in went onto an automated lockdown. My friend’s daughter stepped up from the Metro, a bit late for work at the Pentagon, when that plane hit. There were many more stories from friends. It is still with me.

Filed under: Uncategorized | Tagged: | 20 Comments »

Morning Report 9/11/12

Posted on September 11, 2012 by Brent Nyitray

Vital Statistics:

  Last Change Percent
S&P Futures  1431.7 5.3 0.37%
Eurostoxx Index 2521.7 -6.8 -0.27%
Oil (WTI) 96.72 0.2 0.19%
LIBOR 0.399 -0.006 -1.36%
US Dollar Index (DXY) 80.23 -0.172 -0.21%
10 Year Govt Bond Yield 1.68% 0.02%  
RPX Composite Real Estate Index 193.1 0.2  

Markets are stronger this morning after the government sold a stake in AIG and the National Federation of Independent Businesses noted an increase in optimism.  Deutsche Bank is looking to cut $6 billion in expenses by 2015. The trade deficit shrunk from 44B to 42B.  Bonds are up 7 ticks, while MBS are down a couple.

The National Federation of Independent Business released their Small Business Optimism Report for September, which showed improvement, but is still solidly in recession territory. On the positive side, hiring plans are the best they have been in years; but on the negative side, they aren’t hiring now. It also weighs in on QE, asking the obvious question:  “Is anyone not hiring because interest rates are too high?” They also note that “political uncertainty” is at a new high – 22% of respondents cited that as a reason they are sitting on their hands. That said some pizza parlor owners must be doing okay.

Chart:  NFIB Small Business Optimism Index: 

 

Fannie’s first sale of REO-to-Rentals traded at 96% of BPO.  That is an eye-popping number, given that distressed pools have been trading in the mid / high 60s, but this is an oddball transaction – the buyer (Pacifica) will participate in a JV with Fannie, will put up under 16% of the purchase price, manage the properties, split the cash flows with Fannie and will receive a management fee. It seems odd that Fannie is basically buying properties from itself – Pacifica puts up 12.3MM, while Fannie puts up the rest.  Let me guess, there is a mark-to-market angle here…

FHFA and F&F have launched a new Reps and Warranties framework for conventional loans sold after Jan 1.  Put-Back risk – the risk that the government could come after you and force you to re-purchase a loan if the borrower starts missing payments – has been weighing on mortgage bankers and explains why banks have put such stringent overlays on F&F loans. The government will release banks from this requirement if the loan pays consistently for 36 months. For HAMP loans, it will be 12 months.  Co-incidentally, Congress has a re-introduced a bill to expand HARP refis which may contain language regarding the Qualified Mortgage safe harbor provision. The QM has been a big source of uncertainty for lenders. Finally specifying what constitutes are qualified mortgage could go a long way towards getting mortgage credit flowing again.

Redwood is doing another deal – $312 million of jumbos – the 9th deal since the market froze in 2008. Only 9 jumbo securitizations in 4 years. Probably $2 billion in total. To put that number in perspective, non-agency deals topped 1.2 trillion in 2004 and 2005. 

Filed under: Morning Report | 32 Comments »

Run Silent, Run Deep

Posted on September 10, 2012 by novahockey

The NYT’s is reporting that the drug cartels are building submarines.

This is the new challenge faced by the United States and Latin American countries as narcotics organizations bankroll machine shops operating under cover of South America’s triple-canopy jungles to build diesel-powered submarines that would be the envy of all but a few nations.

This reminds me a bit of Medicare fraud. It’s a game of whack-a-mole. Here, however, it seems like we’re wasting resources. If you can not stop the demand isn’t it better to spend the time and resources on treating the fallout from a health perspective. Instead, we’ve got the Coast Guard chasing more and more capable and advanced semi-submersible crafts and submarines loaded with drugs.

In the movie, Run Silent Run Deep, an American Commander, portrayed by Clark Gable, puts his crew at risk because he is blinded by the need to avenge a lost sub. Here we seem incapable of considering other options, even when those conducting the anti-sub/trafficking operations all but admit defeat.

From the Times:

Even so, three-quarters of potential drug shipments identified by the task force are not interdicted, simply because there are not enough ships and aircraft available for the missions. “My staff watches multi-ton loads go by,” Admiral Michel said.

Filed under: War on Drugs | 8 Comments »

Morning Report 9/10/12

Posted on September 10, 2012 by Brent Nyitray

Vital Statistics:

  Last Change Percent
S&P Futures  1435.6 -2.6 -0.18%
Eurostoxx Index 2528.4 -10.2 -0.40%
Oil (WTI) 96.16 -0.3 -0.27%
LIBOR 0.404 -0.004 -0.86%
US Dollar Index (DXY) 80.35 0.100 0.12%
10 Year Govt Bond Yield 1.68% 0.01%  
RPX Composite Real Estate Index 192.9 0.0  

Markets are down slightly on no some disappointing economic data out of China. Treasury plans to sell $18 billion worth of shares in AIG. Bonds are down 1/2 a point, while MBS are flat.

In spite of the disappointing Chinese data, the Street is heavily long commodities. Chart:  GSCI Index:

 

Italian Prime Minister Mario Monti told CNBC over the weekend that he does not expect Italy to participate in the ECB’s bond buying program, at least initially.  Remember, the individual states have to request the ECB to purchase their debt. 

JP Morgan is out this morning with a note saying they expect the FOMC to extend the low rate guidance through 2015, and initiate a small asset purchase program (maybe $300b) primarily focused on MBS. The FOMC decision is scheduled to be released Thursday at 12:30 est.

The NAR is reporting that housing affordability continues to increase in spite of the fact that prices are up 9.4% YOY.  Decreasing mortgage rates are able to offset the price increases. 

SIFMA and others have provided a formal response to FHFA regarding the Eminent Domain issue in San Bernardino.  They provide a helpful table lining out the trade and who makes / loses money. Basically the winners are the hedge fund behind this and the borrower.  The table doesn’t break out what the state gets, but presumably they will get something out of this as well.  The lender gets slammed.

 

 

 

Filed under: Morning Report | 3 Comments »

NFL Sunday Open Thread

Posted on September 9, 2012 by Michigoose

Quite the day yesterday, football-wise!  A few blowouts, a couple of nail-biters (I’m still somewhat breathless from USF’s win over Nevada), and a lot of good football.  Not to mention Arizona exceeding all of McWing’s expectations!

So who here roots for who?  I’m a Lion’s girl (playing the Rams today at home, and favored to win), which has taught me much humility, as well as a Seahawks fan (who are playing at Arizona but favored to win, also) which has enforced the humility factor.  I’m also a Packers stockholder (favored to win at home over the ‘Niners).  Life is complicated sometimes.

On a somewhat political note, I had no idea Jimmy Fallon was so talented:

I’ve seen Romney, I’ve seen Bain
I’ve seen Clinton speeches I thought would never end
I’ve seen crazy guys talking to invisible men
So I’ll prob’ly vote Obama again

And you gotta love his idea of the dream team!

OK, who has something to add?  I keep hoping Fairlington Blade will drop by with his ceviche recipe.

Happy Sunday!

 

Filed under: Fall, Football, Open Thread | Tagged: | 27 Comments »

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