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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: ild who wrote (24817)	1/17/2005 8:58:38 PM
From: russwinter	Read Replies (1) \| Respond to of 110194

I'm trying to locate the data on % of ARMs (and outstanding mortgage loans) that are one and three year adjustable for obvious reasons. Freddie's data is in Xcel format which I don't have. freddiemac.com Have you located this? Virtually all the ARMS based on these common indexes (1 yr CMT, 6mo-1yr LIBOR, the COFI lags but same story will also develop) will have been adjusted starting last Nov, and going forward at 150-200 bps higher rates than last year. Amazingly hardly a peep anywhere about this, and this is big. The 4.16% ARM rate being quoted is a teaser rate with fees. Today the real adjusted rate on a 1 year CMT based on Jan. 14th reported constant maturity rate and a 2.75% margin is 5.59% before the FOMC rate hike on 2/2. On a one year LIBOR it's 5.97%, and even 6 month LIBORs are 5.63%. iwould if this will kick off a little panic refit boomlet into 5/1 hybrids (about 5.2% right now) or even 30 years (5.75%). ARM holders are getting some problems on their hands, and if rates go higher could get very serious, especialy with all the subprime California wild men.

To: ild who wrote (24817)	1/18/2005 2:20:41 AM
From: ild	Read Replies (1) \| Respond to of 110194

This Week: January 18, 2005 Market Action as Information So far, the recent market decline tells us that an overvalued, overbought, overbullish market has corrected. This is not enough information content, because the market has failed to produce the sort of wide internal divergences that have historically been the hallmark of extreme market risk. We can't rule out further market weakness, and defending our stock holdings with put option coverage is essential, but we still don't have enough evidence to warrant a fully hedged position. By John P. Hussman, Ph.D. hussmanfunds.com