Morning Report: Dovish FOMC minutes

Vital Statistics:

	Last	Change	Percent
S&P Futures	2041.6	-18.9	-0.88%
Eurostoxx Index	2920.0	-85.0	-2.83%
Oil (WTI)	37.05	-1.3	-3.36%
LIBOR	0.625	-0.006	-0.91%
US Dollar Index (DXY)	94.63	0.048	0.05%
10 Year Govt Bond Yield	1.70%	-0.05%
Current Coupon Ginnie Mae TBA	105.6
Current Coupon Fannie Mae TBA	104.9
BankRate 30 Year Fixed Rate Mortgage	3.62

Stocks are lower this morning on no real news. Bonds and MBS are up and the 10 year is flirting with a 1.6 handle

Initial Jobless Claims fell to 267k last week, while consumer comfort dipped slightly.

The Fed re-affirmed their dovish bent in the March FOMC minutes, which were released yesterday afternoon. In discussing the global financial situation, the money quote was: "Nonetheless, many participants indicated that the heightened global risks and the asymmetric ability of monetary policy to respond to them warranted caution in making adjustments to the stance of U.S. monetary policy." The markets have been saying that via the Fed Funds futures for a while now. An April hike is off the table. With the US economy improving, while the rest of the world deteriorates, the Fed doesn't have to be aggressive in hiking rates. We are in uncharted territory here with zero and negative interest rates. They are going to be cautious raising rates when the rest of the world is cutting rates. 2016 could be shaping up to be a great year for mortgage bankers.

The German Bund yield is now a single-digit midget, trading at a 9 basis point yield. The Japanese 10 year yield has been negative since February.

Hedge fund giant Apollo is into the "seller financed" market for low income / bad credit borrowers. It is a hybrid purchase / rental model, where the seller keeps the title and the borrower is responsible for upkeep. Some have called this a predatory model. "Whether the process is called a land sale, contract-for-deed, bond-for-title or something else, the idea is the same: While it gives some low-income Americans a path, though long and winding, to homeownership, it can also be a way for investors to profit from borrowers who don’t qualify for mortgages."