As we zip toward the end of the decade, do you want the U.S. economy to be “Hotter than the hinges of hell?” Probably not, as rates would shoot higher. Do you want rates to plummet? Probably not, as that would indicate a grim U.S. economy. Like the weather, the economy is something people talk about but can’t do anything about. Are the people “with” money not spending it, and the people “without” it doing all the spending? The U.S. economy will continue to grow in 2020 but at a slower pace, economists surveyed by The Wall Street Journal say. Economists expect growth to fall to an average of 1.8% year over year in the fourth quarter of 2020, compared with 2.2% this quarter. Are we anywhere near two straight quarters of negative GDP, the technical definition of a recession? Nope. More in the capital markets section below on what is pushing rates.

Lender Products and Services

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Sutherland and The Money Source are pleased to announce “Joy”. Joy is a digital assistant in the form of a chatbot widget on the TMS Customer portal. The goal of the Digital Assistant is to help quickly answer questions and complete simple transactions. Borrowers will have the ability to self-serve 24 hours a day, 7 days a week. Sean Nagy, EVP of TMS states” With the launch of Joy our TMS Carebot, our customers are now able to obtain guidance completing transactions online and get answers instantaneously. Sutherland understood our mission to Grow Happiness and worked with us to provide a solution that kept our NPS at industry leading levels, while reducing our overall servicing costs.” “Digital innovation and focusing on the customer experience are core strengths of Sutherland. The leadership at TMS has the same vision and focus and we were able to launch this in 4 months,” stated Neil Armstrong, AMP and Head of Global Business Development. For more information on Sutherland’s solutions, contact Neil Armstrong.

It was a banner year for new Loan Officers who took the XINNIX ORIGINATOR™ Program. As mentioned in Saturday’s report, “Companies like XINNIX do a fine job of training and equipping new originators with the skills needed in the industry, among other things.” These XINNIX-trained rookie LOs are trending above industry averages for experienced Loan Officers according to the MBA’s quarterly findings. XINNIX ORIGINATOR™ graduates entered the industry with an average of 4.9 applications in their first month of production. If you are hiring new Loan Officers in 2020, now is the time to schedule a call with a XINNIX Account Executive to see how they can help you get your rookie salesforce started in the industry quickly and with immediate and long-term success.

Multi-channel LOS and mortgage software fintech provider OpenClose® congratulates two of its executives for winning recent awards. Vince Furey, CRO at the company, won HousingWire’s 2019 ‘Vanguard Award’ and its CEO/CTO, Jason Regalbuto, won PROGRESS in Lending’s inaugural ‘Lending Luminary Award.’ Both executives were credited with helping drive multiple innovations, which includes offering OpenClose’s own digital mortgage POS solution and consolidating it with the company’s end-to-end LenderAssist™ LOS platform and borrower direct portal ConsumerAssist™. In addition, Furey and Regalbuto worked together on bringing its RESTful API suite IntegrationAssist™ to market for easier, quicker, more cost-effective third-party integrations. OpenClose enjoyed a banner year and will close out 2019 with a year-over-year revenue increase of more than 100%. Visit its website for more information.

Capital Markets

Yes, the next week or two will be “dead” in terms of locks. And rates have been relatively steady for quite some time. But it is still important for us to keep in mind what is moving the bond market.

Some believe that an inverted yield curve is a predictor of a recession. There’s a chart showing inverted yield curves followed by recessions, so maybe people remember that visual stimulus. It’s very direct. People have memories of seeing it on the news in decades past. Earlier this year people were talking about it, but a recession did not occur. And many believe that the talk of it will bring about a recession because if you think a recession is coming, your probable actions will be to reinforce that. Of course there will eventually be recession. The question is when. This U.S. expansion is the longest in history, so we’re “overdue” for one. The talk of a recession is building up, related to the trade crisis, and its unsettling people and causing them to curtail their spending, and distrust of President Trump is building. But if a recession starts prior to the election, it will discredit him and turn even more public opinion against him.

In terms of numbers, U.S. manufacturing data continues to lag behind while servicing and employment data continue to support the current expansion. This month saw an unexpected non-farm payroll print of +266,000 jobs for November, blowing through expectations of +188,000 after a weaker than expected ADP employment report earlier in the week. The unemployment rate dipped to 3.5 percent and hourly earnings were up 3.1 percent over the last twelve months. The headline jobs number was fueled by a return to work at GM following a six-week strike. Initial unemployment claims fell, shot up, fell again in recent weeks as they remain well within the ultra-low range seen over much of this year. The ISM Non-Manufacturing Index declined in November. Though it has declined, the reading remains near the average from 1997 – 2019 of 54.62. The ISM Manufacturing Index, however, fell due to trade uncertainty and tariffs weighing on the sector. Finally, imports fell by $4.3 billion in October and the trade gap narrowed to -$47.2 billion. With job growth remaining strong as we wrap up the final quarter of the year, the Fed should feel comfortable leaving monetary policy steady into 2020.

Recent economic data showed a little weakness during the middle of Q4. November retail sales disappointed by increasing just 0.2 percent at the headline and were unchanged excluding autos and gasoline. New unemployment insurance claims spiked by 49,000 for the week ending December 7 to 252,000; the highest level since September 2017. However, the Thanksgiving holiday may have affected seasonal adjustments. It is premature to say this is the start of a new trend. Producer prices were unchanged in November and were up only 1.1 percent over the last twelve months. Meanwhile, consumer prices increase 0.3 percent in November and were up 2.1 percent over the prior twelve months as inflation remains well within the Fed's comfort zone. It was no surprise that the Fed kept monetary policy unchanged after their final meeting of 2019. Additionally, Fed Chairman Jerome Powell indicated the committee did not see the need for further changes to policy over the near-term.

It was the week before Christmas, and all across the yield curve, bankers were off their desks, and rates were little stirred. There hasn’t been much to report this week in the way of meaningful market movements. U.S. Treasuries rallied slightly yesterday on the back of weaker than expected economic data and the last FedTrade operation of the year. (Yes, QE is alive and helping the demand side the supply & demand equation.)

Markets did receive a series of central bank decisions, as the Bank of Japan made no changes to its policy but lowered its assessment of industrial production and described overseas risk as "significant," Sweden's Riksbank raised its repurchase rate by 25 bps to 0.00%, ending a five-year stretch of negative rates, the Bank of England voted 7-2 to leave its base rate and asset purchases unchanged, warning that "modest" tightening could be needed to maintain inflation at target, and Banxico cut its overnight rate by 25 bps.

In the United States the third and final look at Q3 GDP kicked off today’s calendar (unrevised at 2.1 percent). If anyone cares, later this morning brings November Personal Income, Personal Spending, the PCE Price Index, core PCE Price Index, the KC Fed Manufacturing Composite, and Final December Michigan Consumer Sentiment. We begin the day with Agency MBS prices worse a few ticks and the 10-year yielding 1.93 percent after closing yesterday yielding 1.91 percent.

Employment and Transitions

A Southwest-based Mortgage Company that is consistently ranked among the Top 50 Mortgage Lenders in the United States and as one of the Best Places to Work in the Southwest. NOVA® Home Loans has branches in Arizona, California, Colorado and Nevada, and can originate loans in 12+ states, and is seeking two experienced Underwriters to focus on Non-Conforming loan programs. The right candidates may elect to work from a brick and mortar office or work remotely from home. Minimum of 8 years underwriting experience required with an emphasis on non-conforming products preferred. Our company has delegated authority with a variety of jumbo loan correspondent partners and the desired candidate will be detail oriented with knowledge of a wide range of guidelines. Experience and knowledge of Encompass is preferred but not required. Compensation will include base salary, a bonus plan and a benefit package. If you're interested, please send a resume to Chrisman LLC’s Anjelica Nixt; specify opportunity.

A leading Non-QM investor is looking to hire an Inside Salesperson to explore new client opportunities and re-establish relationships with approved dormant accounts. The Candidate must have prior inside or outside sales experience (NON-QM preferred). Confidential inquiries should be addressed to Chrisman LLC’s Anjelica Nixt for forwarding on to the principals.

Rob Neill has been hired as Orlando producing area manager for Bell Bank Mortgage, a mortgage company with a 130-year history and an expanding footprint in several U.S. regional markets. Originally from Atco, N.J., Neill is a graduate of Rowan University. Prior to joining Bell, he spent 17 years in mortgage banking. Neill is responsible for developing and overseeing a team of experienced mortgage lenders who will work with clients and real-estate business partners to produce residential home loans. Newly hired with Neill at Bell are mortgage lenders Jodee Dillon, Ruth Oyola, Ann Kelly Young, Tom Kelly and Richie Sloan. Congratulations!

As we get ready to flip the calendar to 2020, America’s Renovation Lender, PrimeLending, is ramping up for another powerhouse year of helping homeowners purchase and/or renovate fixer-uppers. Did you know that PrimeLending offers 18 renovation loan products, including the FHA 203(k) Limited, which recently increased the loan maximum from $35,000 to $50,000 for a limited time in qualified areas? That means borrowers can now do more to create the home of their dreams. Backed by a dedicated renovation loan support team, nobody makes renovation loans simpler for you or your customers than PrimeLending. If you’re looking to join a company that helps you grow your business by offering more loan options, better service and a true expertise in renovation lending, check out PrimeLending!

Sunwest Bank announced Matthew March is its new EVP and chief information officer (CIO) and will oversee all of Sunwest's banking systems and related technology including digital transformation efforts and data management, information technology governance, and regulatory compliance.