Sep. 19, 2008: does sweeping dirt under the carpet get rid of it? And remember that 3-day refi boom earlier this week?

Sep. 19, 2008: does sweeping dirt under the carpet get rid of it? And remember that 3-day refi boom earlier this week? Rob Chrisman

Last night, as I was taunting my dog with a hunk of cheddar cheese waved above her nose, the look in her eye reminded me that there is talk among agents of a mythical refi boom. Not your parent’s refi boom, or the 48 minute refi boom in January, but a real one. Of course, the borrower has to be able to qualify, which seems to be a big question these days. And the property has to be able to qualify, also a big question. Agents and brokers seem to have lots of files on their desks, at this point not waiting for a lower rate, but more likely trying to figure out a way to have the borrower and property qualify. Details, details…

Rates have shot back up (the 10-yr is worse in price by over 2 points!), and instead of originators dusting off renegotiation policies, they’ll be reviewing rate lock extension policies!

When I was a kid it was a source of fascination on my street when a female dog was ready to, uh, “find a suitor”. It was also a source of fascination, on nature shows, when vultures began circling a dying animal, sensing that death was near. I don’t know which analogy is more appropriate, but five banks have come forward to evaluate Washington Mutual’s financial records as part of an auction process run by WaMu’s adviser. WaMu shares rose 14% yesterday after news it had put itself up for sale. The five banks that have looked through the WaMu materials include JPMorgan Chase, Wells Fargo, Citigroup, HSBC and Banco Santander.

Yesterday it was reported that an RTC-type plan was being worked on by the U.S. government. The DOW rallied 600 points from the day’s low, closing up 410 points, and rates moved higher. This has continued this morning: stocks will open higher, and the yield on the 10-yr up to 3.78% and 30-yr mortgage prices worse by .50. The Fed and Treasury are working on a creating a structure that would help financial institutions remove illiquid assets from their balance sheets, by some estimates as much as $500 billion that are difficult to mark-to-market.  

The SEC has also temporarily banned short-selling stock in financial companies. Lastly, in another bold step to restore stability, the U.S. Treasury said it will guarantee money market funds. It is going to insure any publicly offered money market fund, both retail and institutional, that pays a fee, and President Bush has authorized up to $50 billion in protection, and Treasury said it’s acting using the authority of the “Exchange Stabilization Fund”. Money market funds saw nearly $90 billion of net investor cash pulled out Wednesday, among the largest single-day drops in history.

Bubba and Earl are quietly sitting in a fishing boat.

Suddenly Bubba says, “I think I’m gonna divorce my wife – she ain’t spoke to me in over 2 months.”

Earl spits, sips his drink and says, ‘Better think it over… ……women like that are hard to find.”

or

Emma and Mary Lou are quietly sitting in a nail salon.

Suddenly Emma says, “I think I’m gonna divorce my husband – he ain’t spoke to me in over 2 months.”

Mary Lou clears her throat, sips her latte and says, ‘Better think it over… ……men like that are hard to find.”

Rob