MBS RECAP: Relative Destruction For Bond Markets

Posted To: MBS Commentary

With Thursday marking a slightly less robust day of selling compared to Wednesday, it was all too tempting to hope that the bond market was just getting every last little bit of crazy weakness of its system ahead of the 3-day weekend, and that we’d be greeted with a much-needed rally in the coming week. Yet here we are. No rally. Not even a glimmer of respite from last week’s nightmare. Yes, I realize that a 10yr yield of 2.2% and a 30yr fixed mortgage rate at 4.0% is historically low, and that we should all be grateful to operate in the mortgage industry with such rates. But it’s not my job to comment on whether rates are historically low based on various paradigms (not most of the time, anyway). Rather, it’s my job to comment on the forces moving markets, the scope of any…(read more)

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