MBS Live: MBS MID-DAY
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FNMA 3.5
103-06 : +0-01
FNMA 4.0
105-11 : -0-01
FNMA 4.5
106-26 : +0-03
FNMA 5.0
108-05 : +0-02
GNMA 3.5
104-22 : +0-03
GNMA 4.0
107-13 : +0-01
GNMA 4.5
109-04 : +0-03
GNMA 5.0
111-02 : +0-06
FHLMC 3.5
103-02 : +0-03
FHLMC 4.0
105-04 : -0-02
FHLMC 4.5
106-06 : +0-03
FHLMC 5.0
107-20 : +0-02
Pricing as of 11:03 AM EST
Morning Market Updates
A recap of MBS Market Updates provided by MND Analysts and streamed live to the MBS Live Dashboard.
10:47AM  :  HOPE NOW Reports 969K Loan Mods Through November
Key loan modification data points for November 2011:

All loan modifications:
Total modifications were approximately 84,000:
-57,000 were proprietary.
-26,877 were completed under HAMP.

Total permanent loan modifications for homeowners in 2011 are approximately 969,000:
-639,000 were proprietary
-330,303 were completed under HAMP

Proprietary loan modification characteristics (November 2011):
-Loan modifications with reduced principal and interest payments accounted for approximately 68% (39,000) of all proprietary modifications.
-Loan modifications with reduced principal and interest payments by 10% or greater accounted for approximately 66% (38,000) of all proprietary modifications.
-Fixed-rate modifications (initial fixed period of 5 years or more) accounted for approximately 83% (47,000) of all proprietary modifications.
10:05AM  :  ECON: Wholesale Inventories Rise 0.1 pct, Missing Forecast
(Reuters) - Inventories at wholesalers barely rose in November and growth in the prior month was revised lower, suggesting the economy did not get as big of a boost as expected from companies restocking their shelves in recent months. Wholesale inventories climbed 0.1 percent, the Commerce Department reported on Tuesday, falling short of analysts' expectations of a 0.5 percent gain. In the report, the government also lowered its estimate for inventory growth in October to 1.2 percent from 1.6 percent.
8:40AM  :  ALERT: MBS Weaker On Relatively Quiet Overnight Session. Class A Roll Tonight.
A general uptick in "risk-on" trading prevailed overnight. Volume remains somewhat subdued versus the healthier days from the end of last week, but is slightly better than yesterday with Japan back to work. It would be nice if there were some clearcut headline money movers in the overnight session, but alas, the broader risk-on vs risk-off ebbs and flows of European markets continue to dominate US pre-market trading.

In today's version, we find Euro stocks up, bonds down (specifically the long end), with some traders citing Fitch's decision to "not downgrade France yet" as a positive for risk sentiment. Combine this with a decent Greek short term debt auction and perhaps some inclination toward a technical bounce in US 10's coinciding with the desire to get set up for tomorrow's auction and there's plenty of boring, inconsequential goings-on to justify a pull-back to nearly 2%. MBS are down 3 ticks at 103-02, but make sure to shave about another 10 ticks off that in the back of your mind for tonight's roll (Class A = Fannie/Freddie 30yr Fixed MBS)

Despite the quieter volume overall, things are picking up fairly well this morning at the start of the NY session, thought he first major release doesn't hit until 10am with Wholesale Inventories (not so "major" in the big picture, but as far as this morning's economic data is concerned anyway). The more significant event, at least from a historical standpoint would be the 3yr Note auction at 1pm, but these have been less and less of a market-mover since the August FOMC announcement unveiled the "2013 verbiage." Nevertheless, a big deviation from historical averages could still be a mover.

There are a few fed speakers on the docket, and with the generally increasing feeling in the air that QE3 is up for debate, we may or may not be interested in what they have to say. Of the three today, 2 are voters (Pianalto and Williams) and one not voter (KC's George).
Featured Market Discussion
A recap of the featured comments from the Live Discussion on the MBS Live Dashboard.
Matthew Graham  :  "RTRS- ECB'S NOWOTNY SAYS EXPECTS POSITIVE SOLUTION IN HUNGARY'S TALKS WITH IMF, EU "
Matthew Graham  :  "RTRS - WILLIAMS-IF EUROPE FAILS TO RESOLVE DEBT CRISIS, 'ALL BETS ARE OFF' FOR U.S. ECONOMY"
Matthew Graham  :  "RTRS - WILLIAMS SEES UNEMPLOYMENT ABOVE 8 PCT UNTIL WELL INTO NEXT YEAR, AROUND 7 PCT AT END OF 2014 "
Matthew Graham  :  "RTRS- WILLIAMS-U.S. RECOVERY 'NOTABLY WEAK,' UNEMPLOYMENT 'SHOCKINGLY HIGH,' TO STAY HIGH FOR YEARS TO COME "
Matthew Graham  :  "RTRS - FED'S WILLIAMS - "VITAL" THAT FED USE ALL TOOLS AT ITS DISPOSAL "
Matt Hodges  :  "USBank off 25 bps, pricing at 10am"
Matt Hodges  :  "so, anyway, ran AUS on DU at 44% dti on a 663 middle, refer; LP accept"
Matthew Graham  :  "RTRS- U.S. NOV STOCK/SALES RATIO 1.15 MONTHS' WORTH VS OCT 1.15 MONTHS "
Matthew Graham  :  "RTRS- U.S. NOV WHOLESALE SALES +0.6 PCT (CONSENSUS +0.7 PCT) VS OCT +0.8 PCT (PREV +0.9 PCT) "
Matthew Graham  :  "RTRS- U.S. NOV WHOLESALE INVENTORIES +0.1 PCT (CONSENSUS +0.5 PCT) VS OCT +1.2 PCT (PREV +1.6 PCT) "
Matthew Graham  :  "RTRS - EU'S REHN SAYS ECB ACTIONS ARE GREATLY CONTRIBUTING TO STABILISING BANKING SYSTEM "
Matthew Graham  :  "RTRS - EU'S REHN SAYS MARKET IMPATIENCE CAN PUSH SOVEREIGNS INTO LIQUIDITY CRISIS "
Matthew Graham  :  "RTRS- EU'S REHN SAYS FOR ITALY, SPAIN, LABOUR MARKET REFORMS REMAIN PRESSING PRIORITY "
Matthew Graham  :  "RTRS- EU'S REHN SAYS EURO ZONE CRISIS IS BY NO MEANS BEHIND US "
Dan Clifton  :  "here is the link to mortgagee letter about short sales http://www.hud.gov/offices/adm/hudclips/letters/mortgagee/files/09-52ml.pdf"
Victor Burek  :  "my brother short saled his home and wasnt deliquent"
Dan Clifton  :  "I suppose it could happen, but i have never seen a borrwer with a short sale that had not been deliquent"
Dan Clifton  :  "yea kent, it can can be less if not delinquent at time of short sale, but the guide for that is mutually exclusive, who is not deliquent on their loan in the 12 months prior to a short sale?"
Kent Mikkola #353976  :  "Jb.. there is an ML covering. Short sale time frames.. it depends on if the borrower was delinquent at the time of the sale... I'd give you the link but I am mobile"
Thomas Quann  :  "gm all. Hey with the solid rumor of Everbank purchasing MetDeath, I mean MetLife...has anyone heard if they will be keeping the wholesale side moving forward?"
Bryan LaFlamme  :  "Except for documented, extenuating circumstances: RE: extended illness; job loss; death of wage-earner. Then, if they weren't delinquent at the time of the event, they're good to go"