Phil Grossfield's Blog

Wake Up! I slept! Thank goodness! My eyes are awake. Are you awake? Today is the first day of the new QM rules. Are you excited?! I’m excited about the market right now! Read below…

My Market Watch Bonds Up Big! Surprising Jobs Report Comes In Weak…Very Weak. This morning the 30-year Fannie Mae bond is up +81bps. As a result, rates are improved from yesterday. This morning the Jobs Report came in at only 74,000 new jobs when it was expected to come in at around 200,000. That is significantly lower and took everyone by surprise. As a result, traders are buying bonds and rates have improved.

Remember, traders are concluding the economy is weaker because 125,000 less new jobs than expected certainly indicates a weaker economy. That makes sense…less new jobs than expected = weaker economy than thought. Traders would rather invest in bonds when the stock market is a bad bet…and when the economy looks weak the stock market looks like a bad investment. Bonds are up big, and prices are improved accordingly.

We might see some very competitive pricing this month. First, Fannie Mae delayed a Gfee and LLPA increase and now we have a weak economic report. It very well could be a good month…that would be nice, eh?! Here is a look at the Jobs Report over 2013, courtesy of MBS Highway: