Good Morning. Congrats to the Saints. Here is a recap of my weekend....

We had a blizzard...32 inches of THUNDER SNOW.

 The driveway was defeated with snowblowers. This is only the first half of the driveway by the way....

The CAPS came from behind to beat the pens. Ovie had a trick plus the game winning assist in OT. Thats 14 in a row for the C-A-P-S CAPS CAPS CAPS.

Troy saw his shadow. AH! Six more weeks of football.

The Saints won....then my milkaholic ex-gf Lindsay came over.

Phew. I am zonked. What a weekend.

Stocks sold off in a panicky fashion last week as sovereign debt concerns grew over Greece, Portugal, and Spain's ballooning budget deficit and rising borrowing costs. If a coordinated global recovery is to remain on course, one has to assume some sort of financial intervention from the likes of the IMF is in the not so distant future. The  "sell now ask questions later" sentiment that ruled equities for the latter half of the week had strong effects on the bond market. After 10s touched the outer limits of their recent range near 3.71%, yield plummeted as flight to quality fund reallocations poured into the benchmark bond market.

The 3.375% coupon bearing 10 year Treasury note went out +0-10 at 98-12 yielding 3.571% on Friday.

The FN 4.0 was +0-06 at 98-16 yielding 4.146% and the FN 4.5 was +0-03 at 101-13 yielding 4.358%. The secondary market current coupon was 4.294%. Yield spreads were wider into the FTQ rally. "Rate sheet influential" MBS coupons went out near their highest prices seen since mid-December and the best prices of 2010.

After digesting a healthy amount of econ data in the week that was...culminating with the granddaddy of 'em all, NFP....the WEEK AHEAD is a bit slower.

One event outside the world of economics will affect the MBS world: the CLASS A SETTLEMENT process begins tomorrow. That means the normal price drop will occur tomorrow evening when we start watching March FN/FRE 30 year MBS coupons. There is another "event" to keep a watchful eye on as well...the stock lever.

Stocks have been taking a breather of late, is this the beginning of a correction or is the freight just slowing down to pick up a few more riders?

After a considerable amount of chopatility last week, It has been a slow, sideways start to the week. Both stock and rate futures are largely unchanged from last week's going out levels.

The same story applies in mortgage world. Prices are grinding it out to the right, in search of a catalyst to provide some directional guidance.

The FN 4.0 is -0-03 at 98-12 yielding 4.154% and the FN 4.5 is -0-01 at 101-11 yielding 4.361%. The secondary market current coupon is 4.299%.

NEXT EVENT: BREAKFAST