| Last | Change | Percent | |
| S&P Futures | 2085.8 | 0.9 | 0.04% |
| Eurostoxx Index | 3700.0 | -31.4 | -0.84% |
| Oil (WTI) | 47.8 | 0.3 | 0.61% |
| LIBOR | 0.267 | 0.000 | 0.00% |
| US Dollar Index (DXY) | 96.67 | -0.523 | -0.54% |
| 10 Year Govt Bond Yield | 1.86% | -0.01% | |
| Current Coupon Ginnie Mae TBA | 103.1 | 0.0 | |
| Current Coupon Fannie Mae TBA | 102.5 | 0.0 | |
| BankRate 30 Year Fixed Rate Mortgage | 3.82 |
Markets are flat this morning on no major news. Bonds and MBS are flat as well.
Mortgage Applications rose 9.5% last week as purchases rose 4.9% and refis rose 12.3%. Refis were 60.5% of all applications last week.
Durable Goods orders fell 1.4% in February. Cap Goods Orders Non-Defense / Ex-air (a proxy for business capital investment) fell 1.4%, while January was revised downward from .6% to -.1%. Corporate America is not increasing capacity at all, and is not pursuing expansion opportunities.
What do companies with cash burning a hole in their pockets do when there are no great expansion opportunities out there? Buy each other. In a bit of a complicated deal, Heinz is buying Kraft. As oil stays down here, I expect to see some deals in the energy patch. The last time oil was this low (aside from the financial crisis days) we saw some huge deals: Exxon buying Mobil, Conoco buying Philips, and BP buying Amoco.
Rents are rising so fast that they are forcing Millennials to buy houses. In fact, Millennials are now a bigger homebuying cohort than Generation X. Student loan debt remains the biggest hurdle, however. As the economy recovers, a lot of pent-up demand is going to be unleashed. We have gone from a glut of housing to an extreme shortage, which means the builders are going to have to bump up production. The economy is already reasonably strong with only 1.1 million housing starts. If we get back to normalcy (1.5 million), that will provide a big boost. Plus construction employs a lot of people.
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