Certain years gain notoriety in financial markets for various reasons. Sometimes these are massive, individual reasons like 2013, the year of the taper tantrum. Sometimes there are separate themes that pull the market in opposite directions like 2016’s Brexit /Trump election combo that pushed rates massively lower and then massively higher.

2019 has easily joined the ranks of those […]

Financial markets remain transfixed by seemingly insignificant updates relating to US/China trade negotiations. For those who follow markets closely, this can be exasperating at times, but it’s happening for a good reason.

If we only look at shorter-term market movements (like the chart below with this week’s stock prices and bond yields), we might conclude that […]

Last week, we discussed a fairly quick move toward LOWER rates. One short week later and we’re forced to discuss an even more abrupt move back toward HIGHER rates. By Friday, the average mortgage lender was quoting the highest rates in more than 3 months, and things could get worse before they get better.

In both cases, breaking […]

I’ve gone out of my way on several occasions to explain why mortgage rates are not directly affected by Fed rate cuts. Now this week, the Fed cut its rate and mortgage rates dropped abruptly the very next day. Is it time to revisit this logic?

Not even a little bit.  It is true that the Fed […]

In about 2 weeks, the big bond rally of 2019 (i.e. the big drop in rates!) will officially be 1 year old (because it actually began in the 2nd week of November).  This has been a uniquely interesting year for rates.  Granted, there are plenty of other years with the same sort of big overall […]

The UK’s attempt to exit the EU (aka “Brexit”) is back in the news.  UK voters decided to part ways with the EU in 2016, but it’s taken this long to hammer out the details.  After an extension of the original deadline earlier this year, the new deadline of October 31, 2019 is approaching quickly.

That’s […]

It would have been hard to make it through this week without hearing about Friday’s trade deal progress, but how does it affect you?  At face value, a healthy trade partnership is good for the global economy, but if you need a mortgage any time soon,  the trade deal just pushed your rate higher.  

Rates actually began […]

As of Thursday, most major news outlets and even several important trade organizations ran headlines claiming mortgage rates were flat this week.  But rates are actually much lower compared to last week.  What’s up with that?

The culprit is the weekly mortgage rate survey compiled by Freddie Mac which has been the mortgage world’s go-to rate index for decades.  There’s nothing […]

While this newsletter series has said it many times before and in many different ways, it bears repeating (and perhaps some extra emphasis this time around): THE FED DOESN’T SET MORTGAGE RATES.

Here are several recent examples of the same thesis for those that really want to dig in to the underlying science and track record:

Worst […]