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Keep An Eye Over Your Shoulder

Updated: Aug 31, 2023

Happy Market Update!

This week, once again, I’ll start with football. Why? Because I was born in Texas and, by God, that’s what we talk about all year! Last week we loss. I don’t like to lose, but for 4-6 year olds, it’s supposed to be about fun. That’s the rumor. But when they ask if you won or lost, and you tell them you lost…you should see their faces. Clearly winning is more fun. They are some super cute kids. Most of ours are 4, so the brain is still processing they are outside. Haha. But you know what? My brain has to process that frustration has no place on this field. Case in point: Jackson was running down the sidelines and looked over his shoulder at a 6 year old about to catch him. He slowed down (because his goal to reach the end zone had been distracted), and the kid caught him just outside of the end zone. From my vantage point (50 yards away) it was clear he made the goal…but the ref wasn’t listening. But I digress.

I spent 90 mins on Sunday with him showing him how to run where the offense is running to, and that if he looks back when he has the ball, he will slow down. I’m 100% sure that this will stick with him for our doubleheader in Parker this Saturday. Okay, 75%. But he will hear it from me and the other coach if he looks back. Okay, 45% sure. Here is a picture of the coaching before his handoff that almost got the go-ahead touchdown. Coach Daddy (as he likes to call me) instructing Jax. If this kid doesn’t look like he’s ready for sports, I don’t know who is.

Okay, 21% sure.

Who else am I unsure of? Yep…DC! Man, you guys listen. I love it. In case you don’t know, once again our government is discussing raising our debt ceiling. Why? Well, we maxed out our credit cards again as a nation. This is a quote from earlier this week: “We are not a deadbeat nation. We pay our bills.” – Biden. We do? Below…that says we owe $31.74T that T stands for Trillion!! I’m not picking on Biden. He said this Tuesday afternoon. But I think Chase would cut my card in half. Listen, if we raise the ceiling, then we spend to the max again…and again…and again. Why would you ever pay it off…if you controlled the max allowed? Chase doesn’t let me move it each time. You know why? RISK!

Dear Congress: maybe go back to school and learn some accounting…specifically budgeting! Oh, and perhaps create a balance sheet. You see, I work in the mortgage industry. Our self-employed people do NOT get a mortgage without having this dialed in. And that averages about $750K in debt. That’s a “K” not a “T”. Ugh!

CA, CO, CT, and NY apparently don’t pay their bills either! This is from an article from ZeroHedge:

In the state's proposed 2023-2024 budget, $750 million was allocated to start paying down the loans, until Governor Gavin Newsom nixed the provision in early January, leaving businesses in the state responsible for the loans, as mandated by federal regulations - so that the federal unemployment tax rate of .6 percent will increase by .3% per year starting in 2023 until the loan is extinguished.

"California is just not really an employer-friendly state," said Joffe. "This one thing will not be a difference between a business remaining open or closing, but it’s just another burden on top of the many burdens the state puts on employers."

In total, 22 states borrowed money for unemployment insurance from the federal government. All but four, California, Colorado, Connecticut, and New York, have paid back their debts - with California owing the most by far at $18.6 billion as of May 2, followed by New York at $8 billion, Connecticut at $187 million and Colorado at $77 million, according to data from the US Treasury.

Why is paying debt important? Because we are all watching you! We need people to pay their bills too. Please don’t learn from the corruption in our government. These are huge numbers. HUGE!

From: @KobeissiLetter

Moving on…last week was Jobs week (after the Fed raised rates again by ¼ point (remember: that impacts YOUR variable interest rates on credit cards and lines of credit). The big news was that there were some revisions to previous jobs reports. They revised them lower…meaning less jobs were created than they told us originally. Shame on them. But hey, the unemployment rate went down. Hooray! Not so fast! Participation dropped 43,000. That’s people (who are eligible to work, not kids or seniors) leaving the workforce. That’s why your unemployment rate dropped. Thanks to all of you continuing to pay your taxes to support those of working age who choose not to help society.

On to banking…today we found out that deposits dropped 9.5% last week a PacWest (one of the regional banks everyone is watching). This was after they told everyone last week there were no “out of the ordinary” flows. So more lies from bankers. Shocking. How are regional banks this morning? Not…too…good. Here is PacWest from the beginning of this year. Nothing to see here. Move along.

10yr: Let’s spend a minute on this one. I’ve highlighted some bottoms and tops (red horizontal lines). What we see since March, is that we are moving in a sideways channel. This is indecision. Keep this in mind, what direction are we going to go? Even the 10yr isn’t sure. This chart starts from basically Jan 1 of this year. No less than 8 times have we tried to move below my permanent red line at 3.367%. And each time, we moved back up. But again, since March (after the large move down) we won’t move and stay above 3.616% (yellow horizontal line). Something is holding this up…but it does not want to go up. So I still think we see a move to the downside. When is the question…and I don’t know that answer. But we are ready here at Bear Mortgage!

MBS: Similar to the 10yr. (Remember MBS goes up and rates go down). Anytime now, Universe.

Okay, 15% sure (football). Anyway, let’s end with some humor from one of my favorite cartoonists:

Tim Lindsey

Originating Branch Manager

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