Archive for October, 2007

Random Thoughts

  • I’ve never been a fan of All Hallows Even. The tradition of the holiday, unlike most other holidays, does not appeal to me (although the tradition of All Saints Day, tomorrow, conversely does), and I’m not fond of evil, nor candy. Nor begging, comes to that. I do like costumes, and I suppose if we have to have a holiday just so we can we can dress up in fun ways I can put up with it. I could put up with it much more easily if we didn’t have witches and werewolves and spiderwebs and the undead.
  • Despite this, I acknowledge Thriller remains the best music video ever created.
  • My wife and I continue to argue over the invention of trunk-or-treat. She loves it; I don’t. She’s right that it’s faster, and that it’s better overall for the little kids; I’m right that it defeats the purpose of decorating one’s house and it’s substantially less enjoyable for children over 10. I am also right that it triples the candy collection for the average child. That’s where I’m hoping to eventually win the argument that trunk-or-treat is a sign of the apocalypse.
  • Incidentally, most people think that trunk-or-treat was invented for the purpose of keeping kids safe on Hallowe’en. This may be correct, but it is also true that there is no rise – NO rise – in child abductions, in child deaths or injuries, or in child-related accidents on Hallowe’en, and never has been.
  • Remember the “razor-blade-in-the-apple” scare that went around a while back? Never happened. Never. Nowhere. Not on Hallowe’en, not any other time, noplace at all. Remember how people used to poison kids by giving them arsenic-laced cookies as they came around trick-or-treating? I remember that, too. It just never happened. It was a complete fabrication, a myth, an urban legend with no basis in fact. None. Just FYI.
  • To my brother, congratulations on the Red Sox winning the World Series again. To Steve, congratulations on the Rockies’ incredible run through the postseason. They got beat by a better team, that’s all. They’ll be back. But nobody will ever win 21 out of 22 in the last two weeks of the season and the first two rounds of the playoffs ever again. After getting swept in the World Series, the Rockies were 21-5 from September 15 to October 28. Impossible.
  • If the Utah Jazz play like they played last night all season long, they’ll be a serious threat to win the NBA title. That was very, very impressive last night.
  • The Fed announces in half an hour whether it will cut rates again. I’ll report later.

Happy St. Crispin’s Day!

Many of you (and all of you that drive Main Street in Lehi) know that we put up movie quotes on our big window for people to guess and win shakes at Emmett’s (next door, more’s the pity for those of us that would like to shed a couple pounds). We’ve posted “Go ahead, make my day” (Dirty Harry in Sudden Impact), “Supercalifragilisticexpialidocious”, and “Remember, tomorrow is another day. (Scarlett O’Hara)” Usually it takes a day or two for people to guess (there are, after all, only 30,000 or so people that pass this office every day), but sometimes it takes longer. This time, much MUCH longer.

So I suppose it’s fitting that this session’s quote lated until yesterday, the eve of St. Crispin’s Day. It is “We few, we happy few, we band of brothers”, from this:

Enter the KING

WESTMORELAND. O that we now had here
But one ten thousand of those men in England
That do no work to-day!

KING. What’s he that wishes so?
My cousin Westmoreland? No, my fair cousin;
If we are mark’d to die, we are enow
To do our country loss; and if to live,
The fewer men, the greater share of honour.
God’s will! I pray thee, wish not one man more.
By Jove, I am not covetous for gold,
Nor care I who doth feed upon my cost;
It yearns me not if men my garments wear;
Such outward things dwell not in my desires.
But if it be a sin to covet honour,
I am the most offending soul alive.
No, faith, my coz, wish not a man from England.
God’s peace! I would not lose so great an honour
As one man more methinks would share from me
For the best hope I have. O, do not wish one more!
Rather proclaim it, Westmoreland, through my host,
That he which hath no stomach to this fight,
Let him depart; his passport shall be made,
And crowns for convoy put into his purse;
We would not die in that man’s company
That fears his fellowship to die with us.
This day is call’d the feast of Crispian.
He that outlives this day, and comes safe home,
Will stand a tip-toe when this day is nam’d,
And rouse him at the name of Crispian.
He that shall live this day, and see old age,
Will yearly on the vigil feast his neighbours,
And say ‘To-morrow is Saint Crispian.’
Then will he strip his sleeve and show his scars,
And say ‘These wounds I had on Crispian’s day.’
Old men forget; yet all shall be forgot,
But he’ll remember, with advantages,
What feats he did that day. Then shall our names,
Familiar in his mouth as household words-
Harry the King, Bedford and Exeter,
Warwick and Talbot, Salisbury and Gloucester-
Be in their flowing cups freshly rememb’red.
This story shall the good man teach his son;
And Crispin Crispian shall ne’er go by,
From this day to the ending of the world,
But we in it shall be remembered-
We few, we happy few, we band of brothers;
For he to-day that sheds his blood with me
Shall be my brother; be he ne’er so vile,
This day shall gentle his condition;
And gentlemen in England now-a-bed
Shall think themselves accurs’d they were not here,
And hold their manhoods cheap whiles any speaks
That fought with us upon Saint Crispin’s day.

Henry V, by William Shakespeare, most recently in the movie Henry V, with Kenneth Brannagh in the title role. Worth the watch. I have a son named Crispin. We saw this very movie the day before he was born.

Next quote goes up tomorrow.

Best of times, Worst of times

It’s a closing week, which means that we’re occupied here with four loans we expect to close by Friday (though it appears one of them might push to Monday). That leaves little time for blogging, so I’ll just present a really good article about the credit markets that I read today. Here is a salient part:

The great risk is that the overall credit market freezes because lenders are afraid to lend.

And that’s why recent news has been encouraging. The Federal Reserve has made extra short-term credit available to banks and is clearly willing to do more. And the Fed aggressively cut short-term interest rates in September, which greases the wheels for more lending.

In addition, the new fund that the major banks are proposing will ensure that the hardest-hit investors will be able to sell securities when necessary. Equally important, the fund will allow solid securities to be separated from those that are iffy.

There is good news out there. There is bad news out there. I believe that the hardest part of this market will be waiting for people to get some confidence back. Winter won’t help.

Meantime, we’re here and we answer any question you have, any time. No charge. 801-787-2162 or just email me at

A Graphical Representation of the Market

Wanna know how bad things have gotten in the mortgage industry?

Try this:

To Market to Market to Do a Big Loan…

What’s going on in mortgages:

Most of the problem this summer was panic, pure and simple. Secondary-market investors, those that provide liquidity for lending banks, were unsure how much risk they had taken on in purchasing exotic mortgages from lenders over the last couple of years, so they substantially contracted their purchasing, which got rid of a lot of those programs (if no one’s buying them, nobody’s selling them). The panic seems to have abated, and most programs that are here now we can expect to stick around. There will even be some expansion of programs over the next six months. The worst is over.

What’s happening to the home market:

Mostly, what’s happening (in Utah) is that no explosion of building can continue forever, unless you have a corresponding influx of population to support it. The population of Utah County is expanding, make no mistake, but not nearly as fast as houses were being built over the last few years. With skyrocketing home prices and new houses going up overnight, anyone that was looking to buy or build did so in the last couple of years. This released a huge amount of market pressure, and that pressure needs time to build back up. Expect small declines in price – especially for new homes – over the next six months, followed by a period of flat or slightly rising prices as the market builds back up some demand.

What’s still good:

Owner-occupied, good credit, cash down purchases
Non-owner, good credit, 10% or more down
100% first-time purchases
Any buyer with cash, good credit, and verifiable income

What’s iffy and/or more expensive:

100% refinances and purchases
Any stated-income programs (90% max LTV on investor)
Pay-option ARMs
Any buyer without documentable, seasoned cash in the bank

What’s gone:

Pay-option ARMs over 90%
100% stated-income programs
95+% stated investor
Pay-option investor purchases of new-built construction
Refinances of construction loans if the property has been listed

What’s back in play:

Seller carrybacks
Owner financing
Commercial building

That’s where we are up to the minute, as I see it. Of course, this morning Citi Home Equity got rid of its last stated-income program, so maybe we haven’t entirely arrested the slide after all.