Proud Warriors!  Hear Me!  

Long have we been adrift together on uncertain seas.

Many perilous struggles have we endured.  We've lost many brothers and sisters to the madness that beckoned them to "lock" the chains of their own undoing.

But now!  Now virtuous brothers and sisters, the gates of Elysium are thrown open for you proud few!  You chosen few who kept a candle of faith burning.  Onward MBS soldiers!  For I see the very sloping knolls of Elysium!

It looks a little something like this:

Ok, out of respect to the 3 or 4 of our several thousand daily readers who do not appreciate my dramatic flair, I'll turn of the ostentatious spigot of prose now.  But how could those of us who have kept the "float club faith" not help but be a bit giddy with today's events?!  

On a perhaps even more glorious note than the current coupon simply hitting 101, the 5.5 coupon IS ACTUALLY CLOSER TO PAR RIGHT NOW than the 6.0.

As you drift off to sleep tonight be dreaming of 5.5's and leave the 6.0's as but a memory of a forgotten era.

Sure, we'll probably get smacked back down here in the next few days, but as long as we are N steps forward and <N steps back, all will be well.  Depending on how aggressively your lenders reward you this afternoon, locking can make sense for loans closing next week, even then, know that the only source of that sentiment is the "leave well enough alone" instinct that wells up inside me when someone has made it down to the last 2 cases on "Let's Make A Deal."  Even if I firmly believe they have the million dollar case...  But whether or not that is the decision for you is for you to decide.  With rapidly improving late day gains, tomorrow morning would have to be pretty ugly to get us back to current market pricing.  That's a risk I almost always take.

 Of course the more days between you and a doc order is the more heartily I'd recommend the same for you.  Remember!  This is FOUR days in a row of gains.  We've only seen 5 a few times this year.  Also, you have to wonder, with tightening spreads today, if spreads are really comfortable with directional improvement.  I don't believe they are so Treasuries would have to go on a tear tomorrow to give us enough support to have another up day.  But who knows?!  Perhaps we can finally get that "momentum shift" regarding bid demand for MBS which will give way to further tightening. 

Let me put it to you this way.  Forget historical highs or lows...  If we simply had a historically AVERAGE spread level, rates would be approaching the high 4's for a PAR 30 year.  (Thanks a lot mortgage meltdown!)