Market Update | 10-12-23

As expected, market is back focused on inflation even with unknown of conflict.

Read more: Market Update | 10-12-23

The market has broken out in the wrong direction.  The market could stomach the PPI news yesterday even though that is a better “lead measure” gauge in a way than CPI is, which is completely a “lag measure.”

The job market, which I think are much worse already than the numbers has led the market to believe, once again showed limited job loss with only 209k claims.  The continuing claims went up by 30k and surpassed the $1.7 M level again, but the general market believes the BLS report, or better known as the BS report, and thinks we have a rock-solid job market.  I disagree, but one can disguise this through ridiculous seasonal adjustments and looking past the 2nd jobs added.  I know we are seeing A LOT of people buried in credit card debt, savings gone and default starting to increase.  


The volatility from the new oversea has slowed and the market has reversed to its last week behavior with the stock market (equities) getting pummeled with the rapid rise in bond yields today.  That has been the trend, equities increasing when yields come down and getting crushed with yields up.  Not sure how anyone feels much better with a 4.55 10 yr vs. the 4.70 as the 4.55 10 yr at this point in the rate cycle has the impact of an additional hike, but the market has ignored many fundamentals for some time so the only solution here for rates to materially drop is to have things break.  We need to the wheels to come off the bus. 

I do not believe there is any chance for the soft landing and the level of volatility now is only increasing the chance of this getting worse.


I have been reminded on many calls today that selling homes right now is a math equation.  If you use the Interest Party Contribution graphs to get the PREFERRED LENDING relationship for a listing and ultimately mirror what we are doing with builders by increasing prices and increasing the dollars available to get the rates down into the 5’s, I think you will find success and transactions that did not exist.  In addition, take your prequalified buyers to builders in your market and manufacture a price, buydown, etc. that allows your buyer to afford the home and the builder to build for a reasonable return.


This is what will separate everyone right now.  Things are not going to improve overnight, so we need to manufacture transactions any way we can.  This is a HUGE value add to your local builders and agents. 

Pricing has deteriorated by 30-70 BPS today depending on the coupon.  The 10 yr is back hovering around 4.70 and markets are getting crushed.  Feels like a normal day as of late again. 

I will be setting a webinar to walk through the above with becoming a “preferred lender for listing agents” and deploying the same strategies we use with Builders into the resale markets.  Watch for the invite.  I am not sure on a time yet. 

Josh Erskine 

Chief Executive Officer

CalCon Mutual Mortgage LLC dba OneTrust Home Loans
Yellowstone RE Holdings LLC
Yellowstone Global Investments LLC

MARKET UPDATE | 10-06-2023

Hello All,

As mentioned, I am in builder meetings in Florida today. I just walked out of the first meeting and looked at some of the data from this morning. It is not good for mortgage rates.  There is a strong chance we are over 8% by the end of the day on the benchmark averages. 

The market reaction is that most believe there is a clear path to over 5% yields on the 10 year.  I expect equity markets to get crushed and bonds to continue to deteriorate now until something breaks. This path to over 5% is now very possible. 

This late cycle volatility makes the chances for a soft landing nearly impossible.  This is not what the Feds envisioned a few weeks back with the soft landing narrative. 

What we now want to see is things break as quickly as possible as this is going to be the hardest window of your careers unless you are attached to builders.  

Ideally the government shuts down in a few weeks and the equity markets continue to get pummeled, which I think will happen.  That will potentially help rates begin their decent.  This is all a pendulum swinging and it is very far to the right and must swing back.  I believe it will be as quick going down as it was going up when the time comes.  For a year we have been waiting for a break in job numbers and this simply has yet to materialize.  But with savings out, student loans coming off deferment, credit card burdens and high cost to borrow, this is inevitable.  It is just a matter of when and I don’t know the answer to that.  What I know is what is starting to happen is likely to result in a much worse situation the longer it continues before they break.  

Feedback from Builder meetings…  Builder’s absolutely want to work with us.  Their confidence is down with rates where they are and they don’t want to lose the wealth they built back up after getting crushed in the late 2000’s.  This is the easiest time I have ever seen in the industry landing builder partners if you bring something of value.  Those talking points work with a focus on “de-risking” them and giving them the formula to get rates down through forward commitments and take their risk off the table while increasing the pool of buyers.  At these rates, their buyer pool has all but disappeared.  We will spend time on the next national sales webinar going through this.  The time is NOW to solidify long-standing relationships.  

Sorry I am sending this while driving between Orlando and Tampa on freeway.  If typos or grammar issues I apologize.  Agree, I should not be doing this while driving so save the comments.  

Josh Erskine Chief Executive Officer 

MARKET UPDATE | 10-3-23 | & Builder Talking Point Reminder

Hello All,


I am heading out of the office on Thursday and Friday this week for a few Builder Meetings in Florida.  Below I am pasting talking points for Builders.  We are having a high success rate in finding ways to partner with builders.  They are listening right now, and we simply have more tools than others for them. 

I read an alarming statistic this weekend that is important for everyone to grasp.  This is why partnerships with Builders are key as they have inventory.  It stated that there is a model that would show the TOTAL residential origination market dropping to $1 T – $1.2 T in 2024.  In fact, that is the path the market is trading right now, which I think is based on very few fundamentals, but it is the narrative.  I am nearly 100% certain this higher for rate rhetoric does not work and that we are entering the 9th inning here.  The impact on equities if they do not rebound over the last 3–4-week, consumer savings, bankruptcy filings, some gaps in corporate earnings, consumer sentiment and he progress made in inflation all speak to this.  What is happening now, is 100% not supported by any fundamentals, which is why I have not been sending many messages as of late.  The momentum is not a result of data. 

Today is the start of a busy week in job numbers.  The JOLTS report comes out at 10:00 am.  The market is expecting a flat reading from the large decrease last month to 8.8 M.  A miss here with less openings is a lead measure to further slowing of the job market.  Although it has been resilient, this will come to an end.  Unemployment is at a low just before a recession and at this point, I would be willing to bet that we end up in a recession primarily because where yields are being driven to.  With a large backup in rates, which the Feds did not want, we have substantially increased the chances for a negative outcome.  I would be blown away if any Fed seat could say with a straight face that they believe we will have a soft landing as was said just 60 days ago. 

There was a lady on CNBC Squawk Box this morning who is a leader in the investment side of John Hancock.  Although it is clear she gets paid on money in equity markets and there were some things that she was trying to backtrack on because her comments would lead to people moving to cash right now, there was some good things said.  She too makes it clear this market is trading no fundamentals and much of it is momentum trading.  The reality is people should have moved to cash 60 days ago as some of the damage has already been done. 

This is a large pendulum shift and when it shifts like this in short windows, it likely will shift back the other way aggressively.  I am optimistic that we will see a large shift and I think it will occur as soon as the job market shows this break, which I think the pounding equity markets are taking put strain on this.  In the interim, we are along for the ride. 

A market anywhere close to $1 T in 2024 would be devastating for most of the business.  We are up to around 25% – 30% of our volume directly tied to builders.  We want to increase this in the short-term, and I encourage all of you to contact ALL BUILDERS and find ways to get relationships.  A $1 T market is likely another 40% drop from where we are now.  Builders are scared right now too.  They are not seeing their homes fly off the shelves at these rates as the media would make you to believe.  They have a major issue with their market size at current rates as very few people can afford their homes at these rates.  However, there is a solution to this using forward commitments and buy downs to increase the market size and pull in buyers, many of which if they kept their prospect and lead list are already right there. 

A partnership in the West we entered, increased their applications on the lending side, which means increase sales drastically over two identical 45-day periods by 329%.  This was a result of us coming in, adjusting the offering including prices and building a forward commitment structure that unlocked a whole bunch of buyers that they already had in their database.  This is powerful.  Here are those numbers:

  • Pre-OneTrust applications 5/25 – 7/11 = 65
  • Post-OneTrust applications 7/12 – 8/29 = 279
  • That is a 329% increase.

I have talked about hitting one of the hardest windows we have all experiences in this business just prior to the August meeting when this all started.  Well, we are in it and now it is time to out work people, focus on where there is inventory, find ways to get business in the door as opposed to make excuses, and on the other side of this, you will have more business than you had prior as a result.


I am more than happy to help in any way, just email me once you have a good contact at Builders and let’s set a call. 


Below are the talking points I use, and they work.  They are in no order, use what you want to use.  In addition, use the numbers above as they speak for themselves.

Why would a builder look to horizontally integrate their business into loans, insurance, and title / escrow?

  • Control of the process for a large portion of the buyers. 
  • A dedicated team working towards agreed upon service levels and deadlines. 
  • Incremental revenue increases with these products. 
  • Increase in sales (integrating these processes into the system makes the sales process more efficient).
  • In complex markets when financing incentives are needed to sell homes, having a partner that can work with your team on structuring offers to drive traffic and ultimately sales is key.  There is a big difference from lender to lender on this.  Our numbers speak for themselves.  Below is our most recent partnership out of the Pacific NW.

Why CalCon Mutual Mortgage LLC dba OneTrust Home Loans has separated itself from the pack in this market

  • Only platform that all services can be brought with a single platform
  • One of the only companies that has all capital markets functions centralized and ability to move those resources to the joint ventures and partnerships
  • Example – our JVs can do their own forward commitments with builders
  • Hands on approach by our leadership with directors of Builders that works to model the right incentive package that will yield the proper net returns for builder, balances builders risk tolerance and ultimately increases sales.
  • Proven with numbers.  Most recent partnerships numbers resulted in a 320% increase in application for sales in the FIRST 45 days from launch.  These are REAL results.
  • 45 days prior to partnership activity:  5/25 – 7/11 = 65
  • First 45 days of partnership after restructuring incentives and sales prices working with our leadership:  7/12 – 8/29 = 279
  • That is a 329% increase.
  • Assurance that no buyer is being lefty behind
  • There is substantial fallout from buyers that could have qualified that don’t get approved outside of true partnerships
  • Have a very black and white example of a builder that prior to partnership has less than 2% of its sales on borrowers with Govt loans (FHA, VA).  After partnership, the number jumped to 15%+ in first year.  This shows that the builder was losing around 13% of potential sales because of the structure they had in place partnering with financing
  • We are a portfolio lender and bring custom products to our partnerships that cannot be found without piecing together a lot of brokers and banks.  We have one of the largest product sets in the country
  • Big one – Bridge loan where a buyer can buy a home before selling their existing and putting a lien on both properties even if they don’t qualify for both homes
  • Foreign national, unique underwriting (bank statements, P+L, etc.), cross collateral, asset-based loans, etc.  (no one in country has a wider product base that is their own products and not brokering or selling outside than we do
  • Quick standup and execution of partnerships with minimal issues
  • Ability to bring buyers to partnerships through attaching our prequalified buyers in markets where builders are to new home
  • Very strong backup lender to existing platform that is in place and willing to do to prove our value and help them sell more homes and help more homeowners achieve home ownership. 
  • Largest or close to it non-bank construction lender in the country for residential (no one has shown us anyone bigger)
  • Largest non-bank residential portfolio lender in the country (no one has shown us anyone bigger)

Josh Erskine 

Chief Executive Officer

CalCon Mutual Mortgage LLC dba OneTrust Home Loans
Yellowstone RE Holdings LLC
Yellowstone Global Investments LLC

MARKET UPDATE | 9.25.23

BOKF Morning Mortgage Commentary from Chris Maloney

Read more: MARKET UPDATE | 9.25.23

The Highest Priority

The summer is now officially behind us while month and quarter end loom at the close of this week. Despite the Federal Reserve holding its fire last week at 5.50%, Powell’s post-meeting presser reinforced the hawkish leanings of the central bank while governor Bowman piled on with her own hawkish words last Friday. The SEP also raised the Fed’s outlook for where the Fed funds target will be at the end of next year by 50 basis points to a median forecast of 5.10% while hints that another rate hike before year-end may be in the cards are dropped liberally. Both Powell and Bowman reiterated that getting inflation under control matters above all else, and there is a long chain of great economic minds that agree. Back in 1924 F.A. Hayek himself insisted that “price stability has the highest priority from a social and fiscal viewpoint.” Not to mention the moral viewpoint, as well.

In response to the Fed’s hawkish words, the Optimal Blue 30-year mortgage lending rate closed at 7.30% Friday, its highest level in at least half a decade while both the 10- and 30-year Treasury yields hit 4.49% and 4.57%, respectively, on Thursday, their highest levels over the same time period. Fed fund futures that had forecast four rate cuts in 2024 at the beginning of this month now foresee about two and a half. The days of 3% 30-year mortgages are unlikely to return anytime soon, and despite the short-term pain tighter monetary policy will undoubtedly bring it is a necessary process to heal the wounds inflicted by QE4.

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This week will be chock full of economic data, starting with home prices on Tuesday (both the FHFA and S&P indexes are expected to see a month-over-month increases) along with new home sales (expected to drop back below 700k/annualized.) A third guess at 2Q GDP comes on Thursday along with pending home sales, while UMich expectations indexes and the Fed’s beloved PCE Core YoY (forecast to come in at 3.9% from 4.2%) wrap things up on Friday. We will also get plenty of opportunities to hear what Fed officials think about all this, with seven of them on tap to hit the speakers circuit. Six out of the seven are voters, so between Fed tongues wagging, the heavy economic data calendar and month-end, it will be a busy and possibly volatile week.

Last week was a tough one for mortgages, with the US MBS index losing 17 basis points in excess return, it’s worst weekly performance in seven weeks. For the second week running it was the higher coupon UMBS 30-year TBA that were the belle of the ball in terms of performance, though I still see best value in 30-year conventional and Ginnie Mae space within the higher production coupons on an I-spread basis. In 30-year conventional spec pools, Texas and Florida in the 5.5% and higher coupons look enticing along with 275k loan balance in the 6.5% and higher coupons.

We have been seeing interest in lower coupon Ginnie Mae 15-year and higher coupon 20-year pools. On an OAS basis, the Fannie Mae 15- and 20-year indexes look cheapest within the Bloomberg MBS family. As we pointed out in Friday’s commentary, look for more seasoned pools in lower coupon 15-year Ginnie Mae space as they look like they are peaking in the 30 to 40 WALA range. With essentially the entire universe of American home owners lacking refinance incentive, it’s more important than ever to look where you can squeeze the most prepays out of any positions you onboarded at a discount.

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We would like to invite you to join the “Mortgage Chat – BOK” IB group, available via the Bloomberg terminal. It is an anonymous chat room, meaning nobody can see anyone else’s identity. Both BOKF employees and clients are to join. Please feel free to use it as a forum to discuss/ask questions about everything mortgage related. We look forward to chatting with you; all you need do is reach out to me and ask to be added to the roster

Notable

  • Mortgage rates started the week at 7.28%, got as high as 7.47%, and ended at 7.39%. The yearly high is 7.49%
  • Mortgage performance improvement could be reaching an inflection point as continued slowing in the annual pace of change might mean delinquency rates are near cycle lows, Black Knight said

Bank Usage of Federal Reserve of Select Lending Facilities (as of Sept. 20, 2023)

ProgramCurrentPreviousW/W%M/M%
Discount Window$3.1B$2.7B$0.4B14.1%$0.9B40.5%
Bank Term Funding Program$107.8B$107.9B-$0.1B-10.0%$0.5B0.1%
Fed Balance Sheet Assets$8.074T$8.149T-$74.7B-0.0%-$114.9B-0.1%


Source: Federal Reserve H.4.1 (https://www.federalreserve.gov/releases/h41/)

ICYMI: recent mortgage commentary from our desk

  • Monday, Sept. 18: Hope Springs Eternal — it will be a long slog back to the Fed’s 2% inflation target (which I expect them to stick to) and an economic downturn does not necessarily come in tandem with falling prices (remember the 1970s)
  • Tuesday, Sept. 19: Such Are the Times — the latest US homebuilder sentiment index has slid lower two months in a row; this following a slight bounce higher following 2022’s record decline of twelve straight months
  • Wednesday, Sept. 20: Quicken Still Has It — Quicken continues to be one of the fastest paying servicers across the board, making the top five within every incentive bucket. For discount Fannie Mae 15-year purchasers, Quicken is the servicer to look for in your pools
  • Thursday, Sept. 21: Much Ado About Nothing — the Federal Reserve left its Fed funds target rate unchanged. Overall, though, the statement and presser that followed offered much the same opinions, statements and questions as the previous few pressers
  • Friday, Sept. 22: The Devil is in the Details — on both a spread and OAS basis, the 15-year index now looks cheapest among all the Bloomberg indexes, so it may have taken enough of a beating with the long end of the Treasury curve beginning to reset higher

Performance Snapshot (bps)

Percentage

Index NameDurationDailyMTDYTD20222021
Bloomberg U.S. MBS6.3638-179-86-1181-104
Bloomberg Corporate IG6.8747-151121-1576104
Bloomberg U.S. Treasury5.9532-158-89-1246-232

Excess Return

Index NameDurationMTDYTD20222021
Bloomberg U.S. MBS6.36-185-223-68
Fannie Mae 30-year6.86-137-222-53
Fannie Mae 15-year3.81-32-60-19820
Ginnie Mae 30-year6.27-2129-205-144

Today in History

This past weekend in 1387 saw one of the most extravagant medieval English feasts ever recorded. It was held for Richard II and John of Gaunt in London and 14 salted oxen, 120 sheep, 1200 pigeons and 11,000 eggs were on the menu. There was a law passed in 1336 in England that forbade the serving of more than two courses at any one meal, except during feast days when one could serve three. I’m not sure if the law was still in effect by 1387, but as we modern Americans well know Laws Are For The Little People. Plus, Richard II and John of Gaunt habitually went about armed, so they could do as they pleased. Silly laws have been part of all governments since the dawn of time, because if one can’t make others’ lives miserable, what’s the point of being a ruler?

Alfred the Great made it illegal to eat any oxen that had gored someone to death (and the oxen was required to be stoned to death) while all beached whales in England belonged to the Crown, though it was really only the tongue they wanted (whale tongue was considered quite the delicacy in those times.) Did you really need a law like that to stop people from dining on beached whales? Well…you get hungry enough (and famine was a routine experience before capitalism) you’ll eat anything. For example, during the horrific siege of Leningrad (now St. Petersburg) from 1941 to 1944, those trapped within the city were reduced to eating machine grease, motor oil and, at times, each other. Happy Monday, and have a productive day.

MARKET UPDATE | 9.20.23

Fed Decision, Fed Statement and Powell Press Conference

Read more: MARKET UPDATE | 9.20.23

It would be a huge surprise if the Fed does anything other than hold tight today.

The big market mover will be from any changes to the Fed Statement and the details from the press conference. 

We have set cycle highs in the 8th going into 9th inning of the cycle.  What does this mean?  I am sure there will be differing opinions, but I believe it just means that things can drop abruptly.  The higher for longer narrative is likely to play out to be true.  That just means no more hikes.  But there is plenty of economic data showing cracks. 

I saved a quote I saw from Janet Yellen the other day on the TV next to me in the office on CNBC Squawk Box.  I put it on my long to do list way towards bottom so that when I see it in a year, I will remember how ridiculous some of these people are. 


Here it is – Sept 18, 2023 – Janet Yellen – “I don’t see any signs the economy is in risk of a downturn” CNBC 11 am  

Overnight the 10 yr jumped to 4.37, which is well above the cycle highs. 

It is my belief that if there is any acknowledgement of the actual problems, or, a clear statement around being at the end of hikes, we will see a big movement down after the statement.


I don’t think they will acknowledge that they are at the end, but I think there is a good chance they will acknowledge the issues.  Therefore, I believe that we will come materially off the 4.36 – 4.37 highs after today.

We will see what the end of the day brings…

Josh Erskine 

Chief Executive Officer

CalCon Mutual Mortgage LLC dba OneTrust Home Loans
Yellowstone RE Holdings LLC
Yellowstone Global Investments LLC

MARKET UPDATE | 9.18.23

10 yr testing cycle highs from overnight

Read more: MARKET UPDATE | 9.18.23

Wednesday is the Fed’s statement.  Prior to then, there is not much in the way of data that is going to shape the market.

We hit cycle highs overnight.  It is interesting to see the progression from the April lows resulting from the banking crisis to today’s highs.  You can see a steady upward trajectory. 

Although the stock market as well as corporate earnings have continued to hold up, I believe spending has begun to taper substantially in September.  China is having substantial issues and Europe is close to a recession. 


Not only do I think there is next to zero percent chance the Fed’s are hiking on Wednesday, but I also believe that the Fed’s are done hiking and the impact of all those hikes are yet to be realized. 

So now we sit and wait.  There is a decent chance that a statement comes out Wednesday along these lines.  It will not be an absolute, but I do believe we will see a shift in tone and that shift should impact mortgage rates positively.  I don’t think they will come out and say they are done, but I think you will see them recognize they are comfortable with how restrictive rates are and will recognize the progress made. 

We also will need to sit and wait for the reduced spending as well as the reduction in jobs to hit the market.  I don’t think this is overnight, but I do believe in the next 30 days with positive CPI results next month replacing a much larger number and what I expect to be reduced spending to begin to show, that things will show progress.   But it is not stopping us from setting cycle highs in interim. 

We need to continue to increase activities and use our unique loan programs to create transactions.  With reduced inventory, the bridge program is needed in a lot of transactions.  Work to see if you can find those people that Redfin announced are being called back to the office.  They are selling and relocating back to the area where their offices are. 


The next 4-6 months I expect to be some of the hardest many of you have faced in the industry.  There will be winners and losers and the way to get through this is to create deals.  Find buyers, talk to builders, match buyers and builders.  Find renovation properties, find buyers those properties will be a good fit for.  Look for the expensive rents in your markets.  Find Agents representing Sellers that are willing to do concessions for buydowns to get people in the same payment range to own.  If rates come down, demand is likely to increase making things worse.

Please let me know if there is anything we can do to help. 


Unless something changes in the market, we will communicate Wednesday explaining the Fed Statement.  Again, I think there is zero chance they announce a raise, but the market are going to be watching the Fed Statement very closely and paying very close attention to Powell’s talk and Q+A. 

Josh Erskine 

Chief Executive Officer

CalCon Mutual Mortgage LLC dba OneTrust Home Loans
Yellowstone RE Holdings LLC
Yellowstone Global Investments LLC

Privacy | Licensing
NMLS Consumer Access

© 2023 Bluebird Home Loans

Bluebird Home Loans is an Equal Housing Lender NMLS # 2383522. Corporate Address: 616 S. Americana Blvd, Boise, ID 83702. Corporate Phone (877) 482-1874. By refinancing your existing loan, your total finance charges may be higher over the life of the loan. (Reference: 10 VAC 5-160-60 (F))

All products are not available in all states. All options are not available on all programs. All programs are subject to borrower and property qualifications. Rates, terms and conditions are subject to change without notice.

MARKET UPDATE | 9.15.23

10 yr jumped overnight and is now at 4.32

Read more: MARKET UPDATE | 9.15.23

Stronger data in China as well as a market that has begun to take on the position of a “higher for longer” pushed yields up overnight to levels that are likely to test the cycle highs.

Why is this happening now?  Why are Investors not rushing to lock in yields on the 10 yr and MBS at some of the highest levels we have seen in the last 20 years?

The SOFT-LANDING narrative has gained a lot of steam.  Why would that impact the rate market and keep yields high?  Because the market is out of their minds and believe that the market now can sustain these higher rates and substantially tighter credit without major impacts on jobs.

Don’t think that the tone in the market cannot change overnight, but the current trade market is tied to that the Feds, even though there is only a 3% chance now priced into the market of a raise next week, may be able to keep the rates at these high levels for some time.  If there was concern in the market that they would not be able to and if a “cut” was priced in earlier, yields would drop quick.  Based on the market’s reaction to inflation this week, it appears the jobless claims and job market is what now the market is going to trade unless there are huge surprises. 

If you go back a year and read the updates, we talked about the need for inflation data to continue to improve, as it has, but the need for the job market to deteriorate along the way as well.  This has not happened YET because the spending and velocity of money in the market has been high. 

I am a fundamentals person and people CANNOT continue to spend at the pace they have been.  Savings is close to deleted, student loan payments kick in here in a few weeks and credit card debt is extremely high.  I believe the people had their fun this summer, but spending I believe will drop substantially starting now for next few months and I believe soon the job cuts will show and we will not be in the position the market is beginning to expect.  It will happen, it is just when. 

We will see where things go today, but the 4.33 mark is going to be tested throughout the day and it is entirely possible to see a new cycle high based on how much of the market believes we can stay status quo.   Until the data shows it cannot, this higher for longer narrative does not create a large demand on locking in these very attractive returns because those returns will be there in their minds in a few months. 

Josh Erskine 

Chief Executive Officer

CalCon Mutual Mortgage LLC dba OneTrust Home Loans
Yellowstone RE Holdings LLC
Yellowstone Global Investments LLC

Privacy | Licensing
NMLS Consumer Access
© 2023 Bluebird Home Loans
Bluebird Home Loans is an Equal Housing Lender NMLS # 2383522. Corporate Address: 616 S. Americana Blvd, Boise, ID 83702. Corporate Phone (877) 482-1874. By refinancing your existing loan, your total finance charges may be higher over the life of the loan. (Reference: 10 VAC 5-160-60 (F))
All products are not available in all states. All options are not available on all programs. All programs are subject to borrower and property qualifications. Rates, terms and conditions are subject to change without notice.

MARKET UPDATE | 9.14.23

Again, PPI of limited concern as the increase was primarily gasoline – market holding after strong jobless claims report, negative PPI report and negative Retail Sales (all missed high / better than expected which is neg for rates)

Read more: MARKET UPDATE | 9.14.23


Below is a good summary from one of our broker dealers. 


The Retail numbers we mentioned on the webinar yesterday could miss based on seeing Gas, Apparel and New Cars up.  This did in fact happen, with again Gasoline being the largest contributor.  I am not sure why the expectations were so low, which is what we discussed that we could see a large miss.  That did in fact happen. 

No break yet in jobless claims.  Another slight miss. 

Overall, the market has held up yet again as this easily could have yet again pushed yields. 


I still stand by that the market is starting to see the slowdown and we will begin to see that in the next set of reports, which is why I believe we are holding even with not god data for rates typically.

In addition, the European Central Bank did another 25 BPS which could also have upside pressure.  

Some details below on all of this. 

PPI:

  • Headline PPI up +0.7% mom (vs 0.4% expected) with ex Food and Energy +0.2% (vs +0.2% expected)
  • As with CPI yesterday, energy price increases were the largest contributor to reported inflation –with gasoline (and jet fuel) price increases having an outsized impact (gasoline with a 20% increase)

Retail Sales:

  • Headline retail sales up +0.6% mom (vs 0.1% expected)
  • Ex auto and Gas +0.2% (-0.1% expected)
  • Attention now focused on holiday sales with consumers under increasing pressure (inflation, depleted savings, limited ability to tap home refinancing for funding)  

ECB—note how in sync Europe and ECB are with the US and the Fed:

  • ECB raises deposit rate 25bp to 4%
  • ECB President Christine Lagarde would not rule out further rate increases:

“With today’s decision, we have made sufficient contributions, under the current assessment, to returning inflation to target in a timely manner…The focus is probably going to move a bit more to the duration, but it is not to say — because we can’t say — that now that we are at peak.”  (Bloomberg)

Josh Erskine 

Chief Executive Officer

CalCon Mutual Mortgage LLC dba OneTrust Home Loans
Yellowstone RE Holdings LLC
Yellowstone Global Investments LLC

Privacy | Licensing
NMLS Consumer Access

© 2023 Bluebird Home Loans

Bluebird Home Loans is an Equal Housing Lender NMLS # 2383522. Corporate Address: 616 S. Americana Blvd, Boise, ID 83702. Corporate Phone (877) 482-1874. By refinancing your existing loan, your total finance charges may be higher over the life of the loan. (Reference: 10 VAC 5-160-60 (F))

All products are not available in all states. All options are not available on all programs. All programs are subject to borrower and property qualifications. Rates, terms and conditions are subject to change without notice.

MARKET UPDATE | 9.13.23

 It appears we will not break through current resistance and things will likely stay in current ranges – bond and treasury market is fairly flat

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MARKET UPDATE | 9.7.23

Jobless Claims came in LOW (still a resilient job market in general)

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