09/10/2026
Mortgage bonds yesterday were trying hard to hold early in the day, as Treasury Secretary Scott Bessent came out exclaiming, "I AM THE HOUSE" and daring traders to bet against him and his plan to buy back long term Treasuries to keep yields down. However, despite the bravado, the Treasury announced $6 billion in buybacks, not nearly what the market wanted or enough to really do much. After that bonds sold off hard, leaving most lenders to reprice worse.
Another important thing to note yesterday was that the 10yr yield crossed the 4.80 mark convincingly (that's a key word) ending the day at 4.84. The writing was on the wall that things were going to get worse.
Friday's end of day text (WARNING: Contains a NSFW joke)
WRAP UP
Bessent surely isn't the first man to promise a whopper and not deliver and as you would expect, there was disappointment. I promised you volatility today, and markets delivered, with most lenders repricing worse. Trump also making more promises, this time that oil prices will fall AFTER the midterms. Political spin aside, this doesn't bode well for rates.
