SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Strategies & Market Trends : The coming US dollar crisis
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
From: stockycd11/27/2007 10:28:06 PM
  Read Replies (1) of 71456
 
You heard it here first...could the next wave of mortgage resets be a non-event?

The dooms dayers and nay sayers are all excited about the next wave of ARM mortgage resets. But why? There are hundreds, if not thousands of different loan terms out there but most of them are indexed to some sort of treasury bond (or other market rate). Remember the blow-off rally we have been having in the bond market? Even the 30 year is drunk on the punch. Why would we think a fully indexed ARM is going to go up that much? For instance, a local bank in my area showcases a popular 2 year ARM, fully indexed at 2.5% above the one year constant maturity rate. That rate is 3.0% this week. What's this? A fully indexed ARM at 5.5%? Doesn't seem to me to be that big a deal. Now if bonds go into major correction, all bets are off. My bet is, they won't, and most of the ARM resets this year will be painless and possibly the biggest non-event of 2008.

cd
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2025 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News