ADP Reporting 42k Jobs Added In October (Better Than Expected)

ADP is reporting 42k jobs added in October (better than expected).

The breakdown. Education and health care, and trade, transportation, and utilities led the growth.

Mandami, as expected, was elected Mayor of New York City. He does have a nice smile.

𝗠𝘂𝗹𝘁𝗶𝗳𝗮𝗺𝗶𝗹𝘆 𝗗𝗲𝗹𝗶𝗻𝗾𝘂𝗲𝗻𝗰𝗶𝗲𝘀 𝗦𝗼𝗮𝗿 𝘁𝗼 𝟳.𝟭%, Office Delinquencies Soar To 11.8% (CMBS Excess Returns Are Dwindling)

𝗠𝘂𝗹𝘁𝗶𝗳𝗮𝗺𝗶𝗹𝘆 𝗗𝗲𝗹𝗶𝗻𝗾𝘂𝗲𝗻𝗰𝗶𝗲𝘀 𝗦𝗼𝗮𝗿 𝘁𝗼 𝟳.𝟭%.🚨

Office CMBS Delinquency Rate Hits Record 11.8%, Much Worse than Financial Crisis Meltdown. (Wolfstreet)

CMBS excess returns are dwindling.

How will New York City commercial real estate returns perform if Madami wins the NYC Mayoral election?

New Week Starts! 10Y Treasury Yield At 4.112%, Down From 4.397% 1 Year Ago (Yield Curve Steepening)

A new week starts! And the all-important 10-year Treasury yields checks in at 4.112%, down from 4.397% one year ago.

Let’s see if Senate Democrats agree to open the Federal government.

Fed’s QT Surprise! Powell Announced That Maturing Mortgage-backed Securities (MBSs) Will Be Reinvested Into Short-term Treasury Bills

Like tuna surprise (bleech!!), Fed Chair Powell announced a move towards reinvesting maturing MBS into ST Treasury bill decreasing the duration of The Fed’s balance sheet.

Fed’s QT Surprise: Powell announced that maturing mortgage-backed securities (MBSs) will be reinvested into short-term Treasury bills instead of longer-duration Treasuries, signaling a shift toward a shorter-duration balance sheet.
🧭 Strategic Implications: This move distances the Fed from potential “yield curve control” strategies and aligns with pre-2008 norms, where the average maturity was under 3 years—suggesting a long-term pivot in portfolio structure.
💰 Market Impact: The decision, coupled with rising Treasury yields and upcoming refunding announcements, intensifies pressure on the 10-year yield, especially as the Treasury seeks to fund a $38 trillion debt load with more short-term instruments.

I just hope the Nittany Kittens (Penn State) don’t surprise Ohio State in today’s football game!

Fed Cuts Target Rate By 25 Basis Points, Treasury Yield Curve Rises, Mortgage Rates Drop

Yesterday, The Federal Reserve Board of Governors lowered their target interest rate by 25 basis points to 4%.

And on that decrease, the US Treasury yield curve rose slightly.

And mortgage rates declined with the cut in The Fed’s target rate.

For an interesting read, try David Stockman’s “How To Cut $2 Trillion Om Federal Spending.”

US Mortgage Demand Rose 7.1% With Mortgage Rates Declining (Purchase Demand Rose 4% While Refi Demand Rose 9% From Preceding Week)

It came out of The Fed.

Mortgage applications increased 7.1 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending October 24, 2025.

The Market Composite Index, a measure of mortgage loan application volume, increased 7.1 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 7 percent compared with the previous week. The seasonally adjusted Purchase Index increased 5 percent from one week earlier. The unadjusted Purchase Index increased 4 percent compared with the previous week and was 20 percent higher than the same week one year ago.

The Refinance Index increased 9 percent from the previous week and was 111 percent higher than the same week one year ago.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($806,500 or less) decreased to 6.30 percent from 6.37 percent, with points decreasing to 0.58 from 0.59 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans.

Yesterday, The Fed lowered their target rate by 25 basis points. And the 30-year conforming rate index fell by 0.037 basis points to 6.155%.

On the government shutdown side, USDA applications fell more than 26 percent.

Fed Chair Jerome Powell at The Federal Reserve Building in Washington DC.

Consumer Prices Rise 3% YoY, Shelter Rises 3.6% YoY (US Treasury Yield Curve Remains Upward Sloping 3Y-30Y)

Good news! Consumer prices rose only 3% YoY. Lower than the growth in M2 Money of 4.66% YoY and Federal government spending of 7.8% YoY.

While consumer prices rose only 3% YoY, housing (shelter) rose 3.65 YoY.

The US Treasury yield curve remains upward sloping from 2Y-30Y.

Drop In Mortgage Rates Fueling Mortgage Demand (Purchase Demand Nearing 2022 Levels)

The September drop in mortgage rates is sparking the biggest boom in refinancings since the pandemic. Mortgage-refinancing applications have surged above the decade average, despite that period including the record-breaking refi boom of 2020-21 when rates fell to all-time lows. Purchase-loan demand has also rebounded to its best for this time of year since 2022, yet remains well below pre-pandemic levels.

Purchase demand (applications) nearing 2022 levels.

While not mortgage-related, gold is soaring!!

Thanks to Bloomberg’s Erica Adelberg for her amazing charts.

Federal Gov’t Having A Party! Fed Printed 43.2% More Money Since Covid (While The Federal Government Borrowed 56% More Money)

The Federal government is having a party! A spending party requiring massive growth in Federal borrowing AND Fed M2 money printing.

Federal borrowing has increased by 56% since Covid in 2020. And Fed M2 Money increased by 43.2% since Covid outbreak.

M2 money velocity (GDP/M2) is now at 1.392.

As of Q2, interest payments on the national debt exceeds spending on defense.

Despite being shut down by Democrats and Chucky Schumer, The Federal government and Federal Reserve continue to borrow and print money like crazy.

Shutdown! Mortgage Demand Falls 12.7% From Previous Week (Purchase Index Fell 2%, Refi Index Fell 21% As Mortgage Rates Rose)

Shutdown!

Mortgage applications decreased 12.7 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending September 26, 2025.

The Market Composite Index, a measure of mortgage loan application volume, decreased 12.7 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 13 percent compared with the previous week. The seasonally adjusted Purchase Index decreased 1 percent from one week earlier. The unadjusted Purchase Index decreased 2 percent compared with the previous week and was 16 percent higher than the same week one year ago.

The Refinance Index decreased 21 percent from the previous week and was 16 percent higher than the same week one year ago.

Mortgage rates increased to its highest level in three weeks as Treasury yields pushed higher on recent, stronger than expected economic data. After the burst in refinancing activity over the past month, this reversal in mortgage rates led to a sizeable drop in refinance applications, consistent with the view that refinance opportunities this year will be short-lived.

Yes, the Federal government has shut down.