Posted To: MBS Commentary

At the close of business yesterday, the bond market outlook was decidedly negative. We're not talking about a colossal shift in sentiment, mind you, but rather a tipping of the scales back in a more cautious direction. After all, we'd just seen 3 straight weeks of modest improvements (even flat rates would have been a victory), and suddenly found ourselves well on our way to higher yields in the current week. Then Cohn resigned. Gary Cohn was Trump's chief economic advisor. He was seen as a smart, pragmatic voice of reason within the administration. More importantly, he was seen as "market-friendly." Although he was widely expected to depart at some point not too long after the tax bill passed, markets hoped it would later rather than sooner. Logically, the departure of…(read more)