This Ultra-High-Yield Stock Is Cutting Its Dividend Again. Here’s A … – The Motley Fool
This Ultra-High-Yield Stock Is Cutting Its Dividend Again. Here’s A … The Motley Fool
This Ultra-High-Yield Stock Is Cutting Its Dividend Again. Here’s A … The Motley Fool
The Ides of March⦠And college basketball time. Here in Kentucky (men #6 in the East, Louisville womenâs team #5) I overheard someone on the phone. âYesterday I saw a woman in Walmart with March Madness teeth. She was down to her final four.â March Madness is in full swing, whether it is hoops or bonds. Or bank stocks. Is this really a fundamental structural plunging of the United Statesâ financial system? Doubtful. Moodyâs came out with a warning about downgrading certain banks in the United States. It is not 2008. How much of this is psychology? Tweeting causing a run on deposits? Banks everywhere are looking at their liabilities (deposits, since they owe their depositors money) and assets (the money lent out using their depositorâs money, or securities owned. âLending long and borrowing shortâ works when banks can pay very little on their deposits (like checking accounts earning 0 percent) and take that money and earn 4 or 6 percent on securities. But when the deposit base becomes unstable, and a bank has to liquidate those securities at 80 or 90 cents on the dollar, it becomes a problem fast. (Much more below.) Todayâs podcast can be found here and this week is sponsored by Richey May, a recognized leader in providing specialized advisory, audit, tax, technology, and other services in the mortgage industry and in banking. Todayâs has an interview with Bank of England Mortgageâs Quinton Harris on the art and science of forecasting the housing, mortgage, and bond markets.
Mortgage rates fell. Then mortgage rates rose. Then mortgage rates fell again. What the heck is going on out there? Bank runs, bank failures, no more Fed rate hikes? Itâs called uncertainty, which leads to volatility in everything from stocks to bonds and mortgage rates. So if youâre not sure whatâs going on, join the… Read More »Mortgage Rates Are Very Volatile Right Now. Hereâs What to Watch For
The post Mortgage Rates Are Very Volatile Right Now. Hereâs What to Watch For appeared first on The Truth About Mortgage.
Plus, what role the FDIC plays in it all.
You Have Gone Zero Days Without a Systemic Contagion Flare-Up As of Tuesday, the global financial market was able to say it had gone “2” days without a systemic banking contagion flare up. But that number dropped to “0” in the overnight trading session as investors aggressively sold Credit Suisse stock. Other EU banks were dragged down as well. US investors sold stocks first and asked questions later. Once those questions were asked, the move began to reverse, but not nearly enough to erase the day’s bond market gains. Any time this “days without a flare up” sign has a “0” on it, bonds should be doing well. If that number starts ticking higher, rates might feel like doing the same. Econ Data / Events Retail Sales -0.4 vs -0.3 f’cast, +3.2 prev Core Y/Y Producer Price Index 4.4 vs 5.2 f’cast, 5.4 prev NY Fed Manufacturing -24.6 vs -8.0 f’cast, -5.8 prev Market Movement Recap 11:02 AM Sharply stronger overnight on Credit Suisse cliff diving. Fed Funds Rate outlook leading the way so 2yr notes are down 44bps while 10s are “only” down 26bps to 3.42. Remember 3.42? MBS are lagging, which is to be expected amid another flight to safety. 5.5 coupons are up roughly 5/8ths with an eighth point margin of error due to illiquidity. 01:01 PM Rally continues. 10yr down almost 27 bps at 3.42. MBS up 2/3rds of a point in 5.5 coupons. 02:38 PM Plenty of weakness since 1pm with additional selling now after Swiss regulators are said to release a statement soon on a Credit Suisse backstop. MBS up only a quarter point on the day, down a half point from highs. 10yr yields still down 17bps at 3.517, but up more than 10bps from lows. 04:01 PM MBS gradually recovering since 2:30pm ET. Back up by roughly half a point, or slightly more after adjusting for illiquidity. 10yr down 21.6 bps at 3.47.
Where’s the 4th Biggest Bank Failure? With the 2nd biggest bank failure in history on Friday and the 3rd biggest over the weekend, it isn’t entirely insane to keep an eye out for imitators. This was a concern as recently as the wee hours of the night when Fed Funds Futures moved to roughly 4% implied yields for the meetings coming up after next week’s. As hours ticked by without another failure, that number moved up about half a percent. This has been the dominant theme today with CPI not having much of an impact. MBS fared far better than Treasuries, mostly because Treasuries fared so much better than MBS up until the reversal. Econ Data / Events M/M Core CPI 0.5 vs 0.4 f’cast/prev Y/Y Core CPI 5.5 vs 5.5 f’cast, 5.6 prev Market Movement Recap 08:35 AM Moderately weaker overnight. Some volatility after CPI data, but shaking it off. 10yr up 2.8bps at 3.575. MBS unchanged on the day. 09:53 AM Back to weakest levels as markets begin to unwind the recent ‘risk-off’ trade. Stocks are up big and bond yields are following. 10yr up 12.3bps at 3.668. MBS down 3/8ths on the day. 01:40 PM Choppy and sideways through mid-day hours, but gaining a modest amount of ground in the afternoon–at least in longer-dated Treasuries. 10yr still up 7.6bps on the day at 3.623. MBS down 6 ticks on the day (.19). 02:58 PM Sideways grind continues with MBS down an eighth and illiquid at times. 10yr yields are up 9.3bps at 3.64