| Last | Change | Percent | |
| S&P Futures | 1428.8 | 5.6 | 0.39% |
| Eurostoxx Index | 2554.3 | 20.4 | 0.81% |
| Oil (WTI) | 86.74 | -0.4 | -0.40% |
| LIBOR | 0.313 | 0.000 | 0.00% |
| US Dollar Index (DXY) | 80.44 | 0.393 | 0.49% |
| 10 Year Govt Bond Yield | 1.76% | 0.04% | |
| RPX Composite Real Estate Index | 194.1 | -0.3 |
Futures are higher on the back of a better-than-expected October jobs report. Bonds are MBS are down
Nonfarm payrolls increased 171k in Oct and the Sep number was revised ipward from 114k to 148k. The unemployment rate ticked up to 7.9% from 7.8% as the labor force participation rate increased to 63.8%. Weekly hours and pay fell. The report pretty much confirms the labor market is on the mend, albeit slowly.
The Northeast continues to pick up the storm damage, although gasoline shortages are becoming a problem as the lack of power in NJ means that gasoline can't be pumped out of the large tanks into trucks. This will be an additional drag on the 4Q economic numbers as people stay home instead of shopping.
We have another glimpse of how long the Fed thinks QE should last - until the unemployment rate falls below 7.25%. Boston Fed President Eric Rosengren cautioned that this was a threshold, not a specific target. Rosengren is one of the most dovish Fed members, but does not have a vote at the moment. He went further to say that if the unemployment rate falls to 6.5%, it is time to start moving away from ZIRP.
Colony Capital won an auction for 970 Fannie Mae foreclosed homes in Arizona, California, and Nevada. It is a complicated partnership agreement and Colony plans to rent out the properties. It looks like they paid close to BPO $176MM for a portfolio that was appraised at $157MM in Feb. Since Feb, prices have shot up in Arizona. Colony will get 20% of the rents as a management fee, and will take 10% of the profits up to $136MM, and then their take grows to 50%. It looks like they only have to put up something like $34 million. Fannie was unable to sell the Atlanta portfolio.
The MR will be spotty next week as I am traveling to the Left Coast.
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