Today we got the release of 2 economic reports and key interest rate cuts from across the pond. Jobless claims came in pretty much right on expectations at a 481,000 level after last months 478,000. Continuing claims still remain at the highest level since the early 80's. We also had the release of productivity which also came in right at expectations of 1.1% but this is down from last months 3.6% level.

We also got news from the European Central Bank who cut their benchmark rate by .50% and the Bank of England surprised the market with a cut of 1.5% to their key rate. These cuts are relevant to us as it should help to strengthen our Dollar which should help keep inflation in check.

So far this morning, we are seeing a lot of selling and our mortgage backed security is down about 16 ticks which correlates to .50 in discount. It seems that profit takers are jumping in and securing a profit from the last couple days huge rally.

Tomorrow, we get the big piece of economic data that will move the markets, the non farms payroll and unemployement rate. Economists are expecting a loss of 200,000 but there are rumors of the number coming in much higher at 300,000. We should have a pretty volatile day today ahead of this report. If you havent locked your loan yet, it appears that floating is the correct call for the day. We will post back if we see things getting worse but as I have been typing this, mbs have improved from the lows and are only down 11 ticks from close yesterday.