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January 10, 2013

Fundamentals Flat. Qualified Mortgage Defined.

January 10, 2013

Fundamentals Flat. Qualified Mortgage Defined.

Initial Jobless Claims (week ended 1/10/2013)

New Claims –  371,000. Previous was revised to 367,000. 4-week Moving Average – 365,750.  Previous revised to 359,000.

Last week was another holiday shortened week.  I would regard today’s data as market neutral.

Wholesale Trade (November 2012)

Inventories – Month/Month +0.6%.  This is a component of GDP and it tends to be bouncy.

Qualified Mortgages

The CFPB today issued its definition of a qualified mortgage (QM) (see: https://www.maureenterris.com/wp-content/uploads/2013/01/201301_cfpb_ability-to-repay-summary-1.pdf).  In essence it says that the mortgage industry has to do what it has been doing for the past 2 years rather than what it did during the No Doc and high ratio GSE loan era.  One effect will be to give lenders safe-harbor from lawsuits as long as they follow the QM guidelines.