It was a bit of a cruel session for bond markets as the day started out in stronger territory only to sell off with less than 2 hours to go.  After 8 days of general negativity/volatility, this morning's gains were due to arrive any time now.  The fact that they lasted all of 6 hours is yet another feather in the cap of the September slide

Most market participants have their eyes on next week's Fed announcement due to the risk that the rate hike verbiage is changed.  This is also the explanation that most media outlets have latched onto.  Less mainstream, but perhaps equally important is the shift in European Central Bank sentiment that took place last Thursday.  Long story short, the ECB delivered a batch of accommodation that seemed only half complete and now seems to content to let that sit.  This is significant because until then, Draghi had been clear in saying "we have more coming!"  Now he's back to "prepared to do more," etc.  Markets feel duped. 

Next Wednesday will tell us a lot more about how these two central bank factors stack up in terms of market motivation.  If the ECB is really the bigger deal, we won't see the reaction to the FOMC that markets are expecting.  All this having been said, today's weakness ends up moving 10yr yields only about a bp higher, which technically leaves them still inside the 2014 trend toward lower rates.  While that's no guarantee we'll stay there, it's a reminder that we haven't been forcibly removed yet.


MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.
MBS
FNMA 3.0
98-00 : -0-04
FNMA 3.5
101-24 : -0-03
FNMA 4.0
105-02 : -0-04
Treasuries
2 YR
0.5640 : +0.0000
10 YR
2.5510 : +0.0150
30 YR
3.2760 : +0.0060
Pricing as of 9/11/14 4:26PMEST

Today's Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
4:01PM  :  ALERT ISSUED: Negative Reprices Now Highly Likely
3:44PM  :  ALERT ISSUED: Negative Reprices Now More Likely
1:50PM  :  ALERT ISSUED: Negative Reprice Risk Returns as Bonds Shun Auction Results
1:12PM  :  Bond Markets Improve Temporarily After Strong 30yr Auction
10:47AM  :  Bond Markets Catch a Break After 9-10am Head-Fake
10:14AM  :  ALERT ISSUED: Negative Reprices Already a Risk for Early Lenders
9:46AM  :  Bond Markets Take a Break from Recent Selling Spree

MBS Live Chat Highlights
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Jason Anker  :  "continuity of ownership guide"
Peter Bethke  :  "120 days on title"
tim paxton  :  "if son buys home from mom ( currently in default ) can he turn around and do a rate term to get out of the hard money loan or is there a wait time?"
Ben Biscoe  :  "has to be a streamlined accept, just had one like that. 2012 taxes were no good but 2013 was, got a streamlined accept and used income from 2013 only"
Ben Biscoe  :  "jeff run LP and if it asks for one year of tax returns thats all you need. "
Jeff Cotton  :  "Can you use 1 year self employment for Freddie if in the same industry"
Matthew Graham  :  "3.24 high yield and 2.67 Bid to cover"
Matthew Graham  :  "auction was an "A""
Matthew Graham  :  "30yr Auction coming up. Recent bid-to-cover range for this type of auction has been 2.35-2.69. Last one was 2.40. They've tended to come in higher than expected in terms of yield, but not much more than half the time. Current 'expected' yield is 3.262 (based on "when-issued" trading). The difference between that and the "high yield" at auction is the most important metric. (more background on auction jargon here: http://mndne.ws/1gIJmzh)"