The Jon Sanchez Show

11/12-Can mortgage rates move higher? Yes!

Bond yields surged today and as expected, so did mortgage rates while the stock market sold off. As current and future homebuyers watch the 30 year mortgage move back above the 7% level, many are wondering how high can these rates move? We think significantly higher and we’ll explain why this afternoon on the Jon Sanchez Show at 3pm

Duration:: 34m
Broadcast on:: 13 Nov 2024
Audio Format:: other

But there's only one feeling like knowing your banker personally, like growing up with a bank you can count on, like being sure what you've earned is safe, secure, and local. There's only one feeling like knowing you're supporting your community. You deserve more from a bank. You deserve an institution that stood strong for generations. Think of Colorado, there's only one member FDIC. Good Tuesday afternoon to you. Welcome to the John Sanchez Show on his talk, 780K, which is a pleasure to be with you and a pleasure to go around the horn and introduce my co-hosts for this Tuesday as well as the Future Thursday Show. Mr. Dwight Mallard of Synergy One Lending, how are you my friend? I'm doing good, John, how are you today? It was a day Dwight. It was a day for both of us. We both suffered the wrath of the bond market today, didn't we not? Well, yesterday I was sitting there complaining how boring the stock market was with the bond market being closed. I said, it was like a teenager being home without mom and dad to give any guidance whatsoever. The market just kind of moved around yesterday and lo and behold, what did I do? I jinxed ourselves today. Bond market opens up after being closed for Veterans Day yesterday and wreaked havoc for both of us, did it not? Oh, it did. I don't know if this week's going to get any better, right? Yeah. Yeah. What the news coming out in the next couple of days. P.I. tomorrow. P.I. Tomorrow, P.I. The next. Yep. I know. We saw multiple price worsening, you know, for pricing, so throughout the day it just went for it. Just like we predicted on Thursday. More ugly, huh? Yep. I said, just like we predicted on Thursday, you know? Yeah. Yeah. Exactly. Yeah. Well, I'll tell everybody in a moment what we're going to be talking about because it's related to this exact discussion and that is the situation with mortgage rates. Let's turn it over to Corey Edge Realty. How you doing, Big C? I'm doing great. How are you guys? Very good. I've got a question. That's it. Yeah. Hey, we're here, Corey. We're here. We're smiling. We're laughing because all three of us get to be together. So for an hour, we can forget about the trials and tribulation of the bond in the stock market. How about that? That's right. Absolutely. Well, good buddy. Glad you're doing well. Well, let's get right down to it, guys. We've got a lot of things to go over this afternoon and I want to make sure we get it all in. Because Dwight and I were just mentioning it a moment ago. For those of you not aware, today was a day where bond yields absolutely surged and as expected, so did mortgage rates, right? Stock market sold off. It affects everything. Rising rates, not good for anybody except, yeah, maybe if your bank's fortunate enough to pass on some higher interest rates for your savings, but usually that doesn't happen in a rising bond yield environment. But as current and future home buyers, I want you to listen closer to me. And if you're out there, you're watching the 30-year mortgage, you're listening to us, hopefully, checking the news and so on and so forth as to what's going on with the rates. And here we are as you're going to find out the 30-year mortgage back above the 7% mark. Many of you that may be future home buyers, or again, looking to refinance whatever the case may be, are now wondering the following question. How high can these rates go, right? We've spent a number of shows talking about our fear of rising interest rates and how it could slow down this recovery in the housing market. We got teased. Of course, we had a 30-year mortgage almost, well, it touched briefly back in October. What month was it? Right, where we hit up 8%? Gosh, it was in October. Was it? What was it? Or was it October? No, I think it was the end of summer. It was, I think... End of summer. Okay. Yeah. Yeah. That didn't sound right when it came out of my mouth. But it wasn't long ago. We touched eight. Then we dropped below six in some cases. And here we are now back above the 7% mark. So the bottom line is, many of you, I think, are probably wondering, how high can these interest rates move up? How high can these mortgage rates move up? Well the answer is this. And as again, as we said Thursday, and we're going to go into the entire details of our logic and our rationale, the answer to that question is, we think that rates can move significantly higher. And what we're going to be doing for you this afternoon is we're going to explain why we think what our case scenario is as to why, unfortunately, unfortunately, that we think these mortgage rates can go significantly higher. So guys, let's get down to the stock market side of things because Dwight, I want you to chime in because it was your world and my world colliding together today to really give us a very interesting session. Now I want to take everybody back to yesterday when Jason and I went through what the first years looking like are anticipated to look like under the Trump administration. And we said one of the things that we got to be very careful about is right now, equity investors are on a sugar high. Things like this market can do no wrong. And I cautioned everybody yesterday, be careful, don't get over confident, watch your diversification, watch your defensive strategies, because this market cannot continue to go up forever, right? I think yesterday we had five out of the last trading sessions. We were up and, you know, three or four of those days, there were record closes for all three major averages, right? Broad diversification. The world changed after last Wednesday's or last Tuesday nights, election results and Wednesday's trading session. So again, we've been on this sugar high quite a bit. And I said yesterday, we've got to be careful about this. This market will not do this forever. And Jason brought up a good point, a good saying that's stuck in my mind and the market can go down for the because reason, the because reason, because what, because of this, because of that. And this is exactly what happened today. Because of rising interest rates and everyone's fear as to what this could do to the economy, to the economic recovery, this market sold off pretty well today. Now, the good side of it was it was really, the damage was really limited to the Dow side. We actually didn't do all that bad on the surface, on the surface for the NASDAQ and the S&P. But a lot of the damage was done in the Dow. Now, the Dow is a tough end to see to gauge, you know, everyone's fear gauge, I'll call it, simply because you've got 30 stocks in there. Any, for example, Amgen was just a disaster today, Amgen sold off heavily, finished down $22.06, this includes some after hours movement to $2.9975, almost a 7% loss there. You had other that were, you know, under pressure, we saw the banks come under pressure, we saw United Health come under pressure. Some of these areas that have done very well since the election results were mentioned. But now, whatever it is, whether it's profit taking, whether it was just a short cover rally in them, you know, we'll never know. But we've got to watch it very closely. And so, we got started today with news that of Home Depot, Home Depot had a good earnings report, but it wasn't the best guidance, in guys, I thought of you and I saw this reported about four o'clock this morning, Home Depot's management said, "Look at people are holding back because of higher rates." Did you guys see that? Dwight, did you see anything about the comment about that? I did. I did. I think it ended the details, but yeah, I saw the headline on it. Yep. I mean, again, thought of both of you. You got the CFO of Home Depot saying people, they want to spend money on their houses, but yet they're holding back, just kind of what you've said about the real estate market. They're holding back, waiting to find out how things are going because they're on such a tight budget right now. They're not spending quite yet. They want to see these rates come down to make sure it's the right time to do that. Yeah, absolutely. And there was another discussion later in the day where they were talking about the potential effects of future tariffs and what some of those prices go up and they specifically talked about Home Depot and which items it could impact and which items it wouldn't in it. It just makes it more confusing for the consumer to make decisions, unfortunately. Yes. Yes. You're absolutely right on that, Corey. Thank you for bringing that point up. So with that said, that was the Home Depot side. Now, early this morning, when I was starting to look at my first stock updates, we were on the 530 mark, we were up about six basis points on the 10-year yield. I'm like, well, it's not bad. I mean, the market can tolerate that, especially after the bond market being closed yesterday. But guys, in Dwight, I know you were watching, obviously, the bond market is as closely as I was today. Something that was very unusual with the bond market today that we haven't seen in a long time is that the yields continue to rise throughout the trading session, right? It went from a six basis point increase, to an eight, to a nine, to a 10, and then well over 12%, matter of fact, we finished with the 10-year yield up 12 basis points today to a close of 443. And that was very unusual to see it essentially double throughout the day. And especially, guys, there were no economic reports. So the question, of course, comes down to what's driving this and the only conclusion that I can come to at this point, and I'd love to get your guys's opinion, the only conclusion I can come to at this point is what we just said, fear of higher tariffs, fear of this, fear of that. And so that's what we're going to be focusing on on the show tonight, which is, can mortgage rates move higher? And the answer is yes, but we're not just going to say yes and move on to another subject. We're going to explain why we think these mortgage rates can move higher and try to decipher exactly what's going on. But don't you agree, Dwight? Wasn't it a very, very unusual day in the bond market based on what I just described? Yeah, absolutely, John, and I was watching that and hand-in-hand was the mortgage-backed security market. It opened down 31 basis points and finished down 47. So it was just all day long. It continued to just drive itself worse. And like you said, no economic data, nothing there to spook it. But to your point, it says unfavourable re-pricing, bond investors still reacting to election and anticipated policy changes. But John, I already saw a couple articles now already blaming Trump for higher interest rates. Is this what we're going to experience for the next four years, right? I mean, are we going to have, you know, I mean, it's politics first, you know, and the consumer, you know, but they're already blaming it and I get it and I think I said it last week. Do you really believe Trump's going to take us right to the cliff of tariffs and let us fall off? I just don't think that's going to, I mean, I think he's going to try to bring us back to the competitive edge and make things a little more fair, but you know, I guess that comes maybe at a price and these bond traders are just really, you know, I start to wonder when, I start to wonder, John, and this is a horrible thing, what their political affiliation is at times. You know what I'm saying? I mean, it just drives me crazy to sit here and see what we're seeing. Nothing's different today than it was Friday, you know? No, no, that's not true, no, no, no, there's a CPI number tomorrow, but yeah, but remember Dwight, it's the stock and especially the bond market is such a forward-looking indicator, right? The bond traders, the stock traders, they're not looking at what happened today or what happened on Election Day. What they're looking for exactly is what we're doing right now. They're trying to predict what's going to happen, right? What's going to happen in the future? What's going to happen with inflation and volatility and tariffs and, you know, again, Jason and I spent the whole, like I said, the whole show yesterday talking about what we expect to happen in the first year of Trump's presidency. And so that's what I think, you know, not to be a smart outlook with you by any means, but things have changed just from, I know what you're saying, okay, now it's clicking on my brain. What you're saying, nothing has, nothing has changed at this point, but what has changed is people's perception of the future and what may change then, not so much what has changed right now. That's what I think what you're saying, correct? Well, yeah, exactly. I mean, now we're not even going up data, right? Right. Let's just throw data out the window. Why don't you even talk about data, right, because we're now on emotions and feelings, you know. I mean, this is frustrating. It's frustrating. John, it's frustrating to me because this is my livelihood and a lot of other people's livelihoods. I'm I'm going to report back to you with a number of new a number of mortgage renewals are at the beginning of the year. I'll bet you we are down 75, 65, 75 percent from 2021. No, what do you mean, mortgage renewals? License renewals. People. License renewals. Oh, really? Yeah, okay. Yeah. Yeah, share that data. It is just wiping out an entire sector of the economy for a title. The realtors to lend, I mean, this, I mean, you know, and I just, I guess I get really upset and I know I got to go to break, but I mean, we're going to sit here and we're going to drive these rates up because we think we don't like the tariffs. We saw the tariffs, you know, we got, you saw the tariffs and you still had a three percent tenure. Yeah. Well, exactly. We saw all that. Yeah. And like I said, we were three and a half at the end of December of 2019, three and a half was the rate, way before the pandemic. Right. So I just, do they not remember this? I mean, it just filled them in. Oh, they remember. Bring his life. Right. Yeah. No, no. All right. Keep that passion. Keep that passion. I like it. I love it. I love it. I love it. I love it. All right. Let's go to Kristin Snow in the right now. Traffic center. Hi, Kristin. Welcome back to the John Sanchez Show on new stock 780 KOH, which with Corey edge of edge how we finished for the day down 382 on the Dow, a 0.86% loss to $43,910 NASDAQ lost 17 closing at 19,281 in the S&P also a decline of 17 finishing the day at 5,983 modest moves and oils up two tenths of a percent to 65 23 a barrel down a little over 11 bucks, about a half a percent on gold finished at 2,605 15 as we said, the culprit today's weakness at the 10 year treasury yield up 12 basis points to a yield of 4.43%. Our topic this afternoon, can mortgage rates move higher? The answer is absolutely yes. We're going to give you our case as to why that may be. Dwight, let's turn it over to you and then let's bring Corey into the conversation and get this ball rolling. What happened on the 30 year mortgage today? Yes. We had a 10 basis point increase 7.02% on a 30 year fixed according to mortgage news daily, but John, it's all across the board. You're looking at the 30 year FHA 6.4, you know, the VA 6.43. So I mean, they all moved up. So it's just, you know, we, like I said, the Monday before the feds dropped the rates at a half a point, whether that September 16th, we were at 6.17. So I mean, this is how far we've gone. Have you in your illustrious 35 plus year career in two weeks seen a move? Let's see what is that. Would you say it was 6? 6.1? 6.17, that was September what 16th? So 85, yes, September 16th, that's correct. So an 85 basis point move in, you know, we'll call it a month. Is this the new norm? Have you seen? Well, I hope not. I mean, I, well, let's say this way it's the new norm up, but it's not now, but I hope it's not this volatile and nerve-wracking because, you know, John, real quick, I wanted to see my case and, you know, the numbers are all over the board, but according to it, there were 218,000 mortgage, licensed mortgage loan officers in 21, an additional 8,400 in like bank. Hello. So quite a bit. However, by January of 24, so 24, but equally as worse as 23, right? If not worse, most cases, the number of MLOs who closed at least one loan in 23. So 12 months, 23 was 47%, 93,000 loan officers. Now I'm going to argue that that was going to be worse. Yeah. Yeah. 47% to 93,000 closed a loan in, in all of 23. So in 24, I mean, I wouldn't be surprised if we're sitting at 58, 60,000 loan officers nationally. Isn't that something? Corey, do you think those numbers are similar in the real estate industry as far as real estate professionals licensed? Uh, you know, I haven't looked at it, but I'm sure they're pretty being close. I mean, they kind of mirror each other and lack of inventory. I mean, you have the buyers kind of holding off, but then you have the lack of inventory. So there's, I don't know any more 3000 agents in this town and you see how many deals we close per month, 400. So if I do the math and you're going to have your top 10% that are closing the majority of those. So yeah, I wouldn't say it's too far off, but you know, to speak a little bit to Dwight's point. I completely feel the pain, but I do think things are different. I, you look at the national debt from 2019 to now, do you know how much it's up just in those years? And I'm not saying it's one person's fault or the other, but you're up almost $12 trillion in debt. And what the income is, it's the exact same as it was, maybe a little bit less. Now he could argue who's there, but you know, to me, you know, maybe I take a simplistic look, I think bondholders don't aren't Republican or Democrat. But I think they look for profit and they look for greenbacks and they're seeing the writing on the wall. And unfortunately, like we talked about, if Kamala would have won and swept it for the Democrats, you would have the same thing because now there's no checks and balances. And I love Trump. I voted for him. I voted for him every time he's run, but now there's no checks and balances. So they're going to have an open checkbook. So I think the bondholders are just gearing up for some bigger debt and some unknown. And that was my point a moment ago with Dwight that I was saying is it's not what's going on now. It's what's going on in the future. And that's what any investment professional does. I mean, today's over. Right? We can't do anything about today. But what we can do is prepare our clients portfolios, whether you're a bond trader, stock trader, whatever it is, for the future. And that's why I'm so excited about this afternoon's topic because this is what's going on. And Dwight, I know you're fired up today, but I think it, you know, we owe responsibility to the audience to, for the three of us to put our heads together and say, okay, now we're back above the 7% of the 30 year mortgage. Can this go higher? And I know all three of us are in agreement. So when we come back, guys, let's roll up the sleeves and let's bring out the reasons why we think it's going to go higher. Good, bad or indifferent, right? Don't shoot the messengers the same goes, but I'd rather have all of you prepared and say, you know what? Now's the time you get on the phone and call Dwight. You call Cory lock in at this point because I'm very concerned, guys. Very concerned that this may be the best that we're going to see for the rest of this year. And then who knows, maybe even the first part of next year and again, not blaming anybody. This is just the reality of it. This is what the bond traders do. They are the ones controlling interest rates through the fed out of the picture. We don't need the fed to raise rates, lower rates, the bond traders, as we've always said, they are the ones in control. It is not the fed. All the fed does is set the tone by either increasing or decreasing the overnight lending rate. And as you'll find out in our discussion, the likelihood is starting to become even slimmer that we're even going to get a quarter percent cut when that's expected in December. That's becoming slimmer and slimmer. I mean, it's pretty tough. And like Dwight said, at the beginning of the show also, we're going to get CPI tomorrow. We'll get PPI the next day. This is kind of one of the last hurrah, second to the last reports we're going to get for this year. Will that be enough to make the fed give us a quarter percent cut or not? I mean, rates are going up. Is inflation going to go up? We'll see tomorrow. But in the meantime, we do think rates can go higher. We'll tell you why when we come back. Turn it over to Greg Neff. He's got news traffic on weather. Welcome back to the John Sanchez show in his talk, 780 KOH, which was the Dwight Moard of center, Jew and lending, Corey edge of edge. Rility. Once again, we finished with the loss of 382 on the Dow due to rising yields, 0.86% loss, 43,000 910. That was rising yields. One of the reasons now's like in the S&P, both declining by 17 can mortgage rates move higher from here? And our answer is yes. Now what we want to do is give you the rationale as to why we are saying this, right? We want to be as optimistic as anybody, but our job is to be also realistic. And that's what we're facing right now, right? We're in a brand new world since the election results of last Tuesday night. How high can we go? As Dwight indicated, we finished according to Morgan's news daily, the 30 year mortgage, 7.02%. Again, we're up about 86 basis points from just a few months or two months ago, roughly the 16th of November or excuse me, 16th of September when the Fed gave us a half a percent cut. It is backfired. Right? And we were fearful of this. He said it over and over again. What we're going to do is give everybody our rationale, okay? Now something you have to, again, just make sure you have a good understanding of before we get into this because we're going to go a little bit deep with you here. And that is the perception of what's going on, right? Again, the bond market is a great forward-looking indicator, in my opinion, better than the stock market. Bond traders are paranoid by nature. They are more pessimistic than stock traders, that's the bond market, right? They are the ones that adjust the rates, all right? Those are some of the premises I want you to kind of keep in mind as we go through this. Now, guys, I want to start with the first reason why I think, and I know you guys do too, that rates are going to go higher. And when I say this, I want to clarify one point, when I say rates think mortgage rates as well as bond yields, right, instead of me saying rates and yields over and over again, simultaneously both of those, okay? The first one, economic growth, right? Everybody, including the three of us, are very optimistic in regards to economic growth. And as Corey said, especially if we end up winning the house, we have a clean sweep, there is no checks and balances. Some may say that's great, others may say that's not good, some Republicans wanted a split Congress, again, for the checks and balances. But guys, everybody, of course, and this is why the stock market has done so remarkable since election day, everybody, of course, is giddy about economic growth. Dwight, let's start with you. Why is economic growth bad for rates/mortgage rates, yields and mortgage rates? Well, I think it doesn't set up for inflationary possibilities, I mean, you're just humming economy just starts to, people just start spending and spending and so that would add to, I guess, the uncertainty of the bond and the yields, in essence, driving back up. Yep. Economic growth, you're going to say this over and over again, I'm going to use the equal side, economic growth equals high yields. Corey, your opinion on that? I totally agree, it's inflationary, I mean, it doesn't happen to be a bad thing, but it is inflationary but, you know, kind of one of the theories now that this administration and administration will do is they'll grow their way out of this debt which could calm the bond market down, so we'll see. Okay, next reason rates are going higher, lower taxes, Corey, how does that translate to higher yields? Less income, I mean, if, you know, and it's just, it goes back to anything else, if I come to you and I need a loan for, you know, whatever it is, then my income is going to go down, I project it to go down and you're going to question me on it. So, same thing, and again, the new administration is saying, hey, we're going to give tax breaks but we're going to make up for it with spending cuts, which I am all in favor of, but you know, they won't believe it till they see it. Right, right, exactly. And remember, Trump wants to go from 28 to 21 on the corporate rate, haven't seen much chatter recently or heard much chatter recently in regards to a decline in capital gains, I wouldn't be surprised, hopefully that's going to be thrown around also in his administration. But the bottom line is lower taxes, more money in our pocket, more money in our pocket, higher inflation, because we're out there spending, and therefore higher yields. All right, Dwight, let's come back to you on the next one, deregulation. That equals higher rates, higher yields. Well, that just, that puts the power back in a corporate, you know, structure and allows them to, you know, take a home builder, a home builder now can build faster and drive up the prices based on demand. So I see that that deregulation just will just, it's primer to the, to the gas, right? I mean, it's just going to going to set things on fire. Right. Okay, so so far, these are the reasons where rates are going to go higher, economic growth, lower taxes, deregulation. Let's come back to the I word that both of you have mentioned. Let's go into more detail, inflationary concerns. Now we all know this game, folks, if the inflation starts to rise, which I don't think we're going to see a significant increase in inflation tomorrow with CPI Thursday with PPI, but I'm talking again months down the road, which that's why I said the beginning, bond market traders, they're not looking today tomorrow next week, next month, they're looking months if not years down the road. If inflation starts to rise because the economy is doing so well, they are forced to sell the bonds. And as we all know, I'll go over it one more time in a simplistic format. That is my teeter totter principle. Remember folks, you've got bond prices, let's say a thousand bucks on the left side of the teeter totter. You have the bond yield on the right side, let's say 4%. When those bond traders start to sell those bonds because the last thing you want to do is own a fixed income investment, such as a bond or a CD and a rising inflationary environment. What do they do? They're selling the bonds. This folks is one of the primary reasons I'm going to put 80% of the blame as to today's run up and if these rates continue to run up, this is 80% of the reason right now. These bond traders are predicting that inflation is going to rise no matter what the Fed does because these traders are selling the bonds. Their fear that the economy is going to do so well under Trump that you're going to see inflation rise. And again, you don't want to own bonds, so they're selling those ahead of that concern. Cory, jump in. I totally agree. I think it sounds counterintuitive, right? Like the economy. Yes, it does. Everybody's worried about it, but you got to remember, we've had periods of great economy with higher rates and everybody was happy. So if we get specifically to the housing market, to me, that points back to inventory issues. Like we talked about last week, there are things that a businessman like Donald Trump can figure out about letting people carry their existing rate over to the new house, giving a capital gains vacation, things that don't adversely affect the deficit, but that free up some of this inventory that's just kind of sitting there. And I firmly believe, and I think you guys do too, people are a payment society. Do I conserve them 10%, but if they're payments two grand a month, that'll sign on the dotted line. No question. There comes the 40, 50, 60 year mortgage. Yep. Absolutely. Another thing too. There's a lot of leverage he can pull and still have higher rates and everybody could be happy. And I think that's to your point, Corey, excellent, excellent points to your point. That's why I think it's going to be very critical to see who he appoints as Treasury Secretary and eventually who he, you know, nominates because it has to be approved by Congress who the next Federal Reserve Chairman or Chairwoman is going to be because they're going to have to buy into that thought process. Well, and they're vocabulary there can't be transitory in their vocabulary. Yeah. Eliminate that word. Eliminate that word. Yeah. I don't want to hear that again. Yeah. So to summarize on the inflationary side, folks, this is, again, great economy. And like Corey said, it sounds so strange, but this is the way Wall Street works. Strong stock market, strong economy, bond yields rise, bond prices go down. And again, if rates start to rise one more time, people are also going to be disappointed and this worries me as far as the stock market is concerned. People are going to be disappointed that that little IV that the Fed has put into our arm with that half a percent cut back in September, that drug is going to come out of the arm because if inflation starts to rise, guess what? The Fed is not going to be cutting anything. They're not going to give us this quarter percent cut that the streets anticipating in December. It's just not going to happen. Right? If inflation is rising, that's not what they want. They want inflation to come down. So these next couple inflationary reports are going to be very critical leading into the new year when Trump gets into office. John, that's where all the headlines were today, when you look at it in the mortgage arena was, you know, the cuts for 25, you know, I mean, that's where all the headlines went, you know. So to your point, I mean, they're just looking for now a reason why not to cut rates, you know, I mean, and so I just think, you know, but John, I still am confused. You know, what I'm confused about is that, well, there's two things, you know, you can go look side by side, you go look at the 10-year treasury during Trump, his path. I mean, he has a record. You can look at it. You can look at the GDP. I mean, he had a smoking economy and low rates. I mean, nobody can deny that. But I hate to say this, Dwight, this time it's different. Okay. But isn't it a wait and see, I mean, again, the other point, the other point I want to make, the other point is typically when you see what we've seen, when rates go up the way they're going up, the cost of something like a house should go down. I mean, that's what I learned in economics 101, you know, and I'm ready to ask for my refund again because it just doesn't apply. But I mean, that's where I think the homebuyer, more specifically a mirena is frustrated, right? Absolutely. I can't buy it at 500 at these rates. So when rates go up even higher than it should go to force it and they're not and it goes back to what Corey's saying. We've got an inventory problem, but you do have a business man that might have some ideas to how to fix this inventory issue, the rather than just put their heads out. But guys, we need to think outside the box. It's not just an inventory problem. It's a damn strong economy. People have jobs and to back to Corey's beautiful point, we're a payment driven society. If you're confident that you're going to be employed for the next however many years, do you really care for HR at seven, eight, nine percent? Yes, but at the same time, you're starting to get, as you always talk about Dwight, you know, qualification problems, right? Rates are not rising as fast as home prices. They're not rising as fast as interest rates. So my income is not keeping up with things. So therefore I've got to sit on the sidelines and continue to, I mean, I have this conversation with people all the time. They just, they want to be in a house, but they cannot afford it. Wages have not kept up. And so you're delinquencies, you're delinquencies are up in Q three. Are they? So I mean, it's all, yeah, yeah, they're not up huge, but they're up and that's not a good thing. They're trending. Yeah. They're trending. Yeah. So, so bottom line, and we'll come back and I want to wrap up with fiscal policies is another reason that rates are going to go higher. The bottom line is we all are predicting a very, very, very strong economy under the Trump administration. The downside is going to be we're going to be paying much more forward as far as rates go. Let's wrap it up with Kristin Snow in the right now, traffic center. Hi, Kristin. Welcome back to the John Sanchez Show in his talk, 780KOH. Mr. Raj, can we get your number, sir? six, seven, three, six, seven, zero, zero, Mr. Rillard, two, four, zero, two, zero, two, two, beautiful. Thank you, fellows. It's been a great show. I've really enjoyed going through the again, these reasons can mortgage rates move higher. The answer being yes, the rationale behind it. Let's squeeze in here with about a minute remaining guys, fiscal policies. Now, pretty simple on this one also, everyone. If the government borrowing cost increase to fund tax cuts, to fund infrastructure spending, to fund all the different things that the Trump administration wants to do. That, of course, will lead to higher interest rates as the government competes with the private sector for funds. Cory, your opinion. Absolutely. And that's where you're seeing some of the bondholders are questioning the debt, they're questioning the GDP to the debt, and they had a great story in the Wall Street Journal last week about how some of these bond traders are going to the corporate debt because they view it as more secure than the U.S. debt, which is amazing, but that's what happened. You amazed me how well-versed you are and things. You should have been a stock trader before Cory. I know you're saying, maybe you're too calm, you need hyper-person, I was like, "Dwight, nigh." Real quickly, your opinions on the fiscal policy issues. Yeah, I agree. Either way, we were stuck with more spent borrowing, so pay for everything. I just hope that we see some different outcomes as we go through this, but it'll be interesting. Yeah, it's a tough one, folks, and again, we don't want to be Debbie Downers by any starts of the imagination. Our job's to lay it out the way we see it. So bottom line, we think rates are going to go higher, hence the reason. Pick up the phone, call Mr. Edge, call Mr. Mallard, get those things locked in at this point. Hopefully, I'm wrong, and we're wrong, but if not, you may look back when rates are at seven and a half, eight percent, which easily could happen, easily could happen, and go, "Man, I wish I would have locked in at seven." We never know where things are going to be, but all we can do is try to read the tea leaves as the saying goes, "Great job, boys. We'll do it again tomorrow on the John Sanchez Show. God bless. Have a great evening." This program was sponsored by Sanchez Wealth Management. The material in this program was intended as general information only, and should not be taking a specific investment tax or legal advice. None of the information on this broadcast was intended to be a solicitation for the purchase or sale of any security. Further information is available by contacting John at Sanchezwealthmanagement.com or 775-801-801. John Sanchez offers securities and advisory services through Independent Financial Group LLC, a registered broker dealer and investment advisor. Member FINRA SIPC, securities only offered in states John Sanchez is registered in. Sanchez Wealth Management LLC and Independent Financial Group LLC are unaffiliated entities. Synergy One Lending Week Equal Housing Opportunity, and MLS #1907235, Dwight Mallard, and MLS #241259, phone number 775240222. The information provided today is for educational purposes only. The position strategies or opinions of the show do not necessarily represent the position strategies or opinions of Synergy One Lending or its affiliates. All information loan programs, interest rates, terms, and conditions are subject to change without notice. Synergy One Lending offers home loan financing only. Synergy One Lending is not affiliated with the John Sanchez Show. 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