Posted To: MBS Commentary

Based on volumes, liquidity, and most importantly, the calendar itself, there's a compelling case to be made for closing the book on 2019 as a trading year and picking things back up with 2020 developments. Why would we throw away 2 weeks of trading and what exactly does that entail? First off, the next 2 weeks (the exact amount of time left in 2019) will not be thrown away in the sense of bond prices' impact on mortgage rates. If bonds tank, rates will still move higher, and if bonds rally epically, rates can still fall. That said, major rallies will have less of an impact than they might in other months where more traders are trading more money, and where there's no apprehension about liquidity drying up even more in the coming weeks. What is liquidity and why will it dry up?…(read more)

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Source: Mortgage News Daily