Issuance Sets The Tone and Keeps Bonds Range-Bound Bonds have now spent more than 2 weeks locked inside a very narrow trading range.  As of yesterday, yields were trying to break through the floor in the morning before moving back into the range by the close.  Today continued the rebound... Read more
Published on: 2022-11-29
Corporate debt issuance is a net negative for bonds.  There was a lull in issuance heading into Thanksgiving.  With traders snapping out of holiday mode, it makes sense to see new issuance coming to market. It all seems so obvious in retrospect, but bonds apparently hadn't priced in enough of... Read more
Published on: 2022-11-29
Lenders and vendors alike are emerging from Thanksgiving and looking ahead to which day they have off for Christmas in the U.S., the 23rd or the 26th. An informal Chrisman poll shows the 26th, but there is definitely a noticeable percentage who are taking both days off. It is good... Read more
Published on: 2022-11-29
Bonds were effectively closed for a 4-day weekend starting with Thanksgiving last Thursday.  True, Friday was technically open for half a day, but volume and participation were so light as to make any of the movement questionable.  This is typical of any Friday after Thanksgiving. The following Monday (or "today"... Read more
Published on: 2022-11-28
Why does opening every ironing board sound like you’re dipping a witch in scalding oil? Cutting costs can sound like that as well, and while we await the 2023 conforming loan limits tomorrow, and the industry grapples with massive credit reporting cost hikes, lenders are not the only ones taking... Read more
Published on: 2022-11-28
Putting out this daily commentary is like being in the army: I usually do more by 6AM than many people do during much of the day. The commentary is a little early this morning since I received an email on Thanksgiving from IsabelleDuvall@opale-voyages.fr that my U.S. Government social security account... Read more
Published on: 2022-11-25
MBS live will be operating in "holiday light" mode today.   The weekly newsletter is on holiday but will be back next week. Commentary and alerts will only be written in the event of extra large bond market movement.  How would that be defined?  It's fairly simple in this case: unless... Read more
Published on: 2022-11-25
Rates Recover Nicely After Fed Minutes Today was the only day of the holiday-shortened week with any meaningful economic data on the calendar.  It's debatable whether we should pay much attention to the intraday volatility considering the narrowness of the range and the impending holiday weekend.  The only abundantly clear... Read more
Published on: 2022-11-23
We'd be the first to advocate taking Thanksgiving week trading momentum with a grain of salt, so this morning's discussion is less about drawing connections to market movement and more about the general message in some of the econ data.  In this case, it just happens to advocate for the... Read more
Published on: 2022-11-23
Let me save you a web search tomorrow: 1-800-butterball. A web search turned up a misconception: It appears that robber Willie Horton, when he was asked why he robbed banks, never said, "That's where the money is." But banks are where the money is, and it is certainly catchy. You... Read more
Published on: 2022-11-23
Light Participation Limits MBS Gains as Treasuries Shrug Off Weak Auction Today's 7yr Treasury auction was one of the only actionable items on today's calendar.  It came out much weaker than expected and, for a moment, it looked like bonds might care.  10 minutes later and buyers had steamrolled through... Read more
Published on: 2022-11-22
Welcome to the bond market on Thanksgiving week in a year with the fastest rate spike in 4 decades, driven by inflation.  This year, it just so happens that Thanksgiving week falls between the two most important CPI reports in a generation.  Actually, the true importance will be determined by... Read more
Published on: 2022-11-22
When was the last time that you did something for the first time? (Warning: tissues may be needed.) The best use of technology is to improve quality of life. Watch people’s beautiful first expressions of hearing sounds for the first time. (This came from an email from Steve Wozniak –... Read more
Published on: 2022-11-22
Random, Inconsequential Volatility Driven by Holiday Week Trading Conditions No sooner did we finish reading this morning's warning about the ill effects of illiquidity than the market began offering examples.  For their part, Treasuries experienced a slightly more linear rally between 7:50am and 9:30am with the last 15 minutes being... Read more
Published on: 2022-11-21
Whereas humans might feel sleepy after a big holiday meal, the bond market often feels that way for the entire holiday week.  Thanksgiving week is one of the best examples of this, but what does it mean for a market to be "sleepy?"  The simplest manifestation is lower volume and... Read more
Published on: 2022-11-21
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