[David] Okay. We’re gonna get into talking about the market commentary in just a minute, but I wanna get back to any commentary on Adam DeSanctis. I think it’s really positive that we’re reintroducing the trigger bill. I’d love to see some of the modifications they’ve made to the bill from originally. Alice, do you have any idea, any modifications they made from what they tried to get through last time? any insights to that? or is it pretty much the same?
[Alice] Yeah, it’s pretty much the same.
[David] Yeah, pretty much the same. All right. Good. Badly needed. Get in folks and support that with your Mortgage Action Alliance app from your cell phone, smartphone, whatever device you want to use, get in and make sure you’re supporting the MBA. This is a really important one. We gotta have this one. All right. Bill Corbett coming to you, friend. We gotta get to you and find out. I need this interpretation of Les Parker’s segment. So help me through that. I don’t know why. Maybe it’s because I’m mobile, I don’t exactly see exactly what he is what he is doing there, friend.
[Bill] So I think there are a couple of things before we dive into that. I just, as Matt pointed out, when everything started with trashing power, that the phrase that kept popping into my head that when folks talk about US treasuries, they say they’re backed by the full faith and credit of the US government and so the faith part is gone right now. and I just didn’t, I still a little bit believe in Santa Claus too, but If Trump were going at a lot of his initiatives with more thought, more class, frankly he probably wouldn’t be getting a lot of the whipsaw wild reactions out of the market that are, he’s becoming his own worst enemy, folks are getting nervous about the 1%, the random this would be the worst case, but it’ll never happen and everybody’s now talking about the worst case going convince me why it won’t happen. And it’s pretty hard to refute a lot of that thought process. I think one of the things in what Les talked about where we’re getting back to a quote unquote, normally shaped yield curve where, you know, at least as of early this morning, the difference between the 2 year and 10 year yield was about 60 basis points, right? We had been inverted for so long and then hung in the 10-20 basis point range for a while, and that’s where for mortgage lending and rates, the steeper the yield curve gets, the less, it’s really locked into the 10 year and it’s more a combination of 5 and 10 and, folks are getting nervous and you think you’re seeing more activity and yields dropping faster in the short end of the curve, which somewhat is better for mortgages. But a lot of that is people feel like they’ve gotta put money in treasuries, but they’re not willing to go further out the curve and that really comes down to what are the tariffs gonna look like and what are the impacts? But when and I think Matt talked about inflation expectations, I think that is a huge deal right now because people are reacting to what they think is going to happen and it quickly can become a self-fulfilling prophecy and I’ve heard stories of people are buying cars faster. They’re already out buying the toys for their kids Christmas, because they’re not sure, not only how much they’re gonna cost, but what’s gonna be available come fourth quarter, and that can take on a life of its own.
[David] Yes, that’s an interesting thing. I was thinking about that this weekend when I was putting up some we’re selling house and we’re putting up some new blinds, get everything looking really sharp for the house sale and I noted the blinds I bought were made in China, and I was thinking, huh, I wonder what these would’ve cost me if I would’ve bought them now or gonna be buying them here in a few months out. I bet you this these things are gonna be a whole lot more expensive and they’re already dogon expensive. But I think this is got a lot of people thinking, which is gonna be going to the consumer sentiment number that’s coming out on Friday. That’s a reactionary number. Everyone, consumers are reacting, whether it be consumer confidence or consumer sentiment, it’s more of a reaction, an emotional reaction to what they see in the news headlines than a good indicator, but something we pay attention to nonetheless.
[Bill] And so here’s an interesting anecdote for everybody. My wife has an interior design business. We’re just over at a design show in Italy and as she’s walking around talking to vendors and they had two price lists, they had a price list for everybody else and said, here’s what our prices are and they had a price list if you were from the US that said, fall for a quote.
[David] That is really interesting. By the way, it’s good to have you back. I hope your trip to Italy was fine. I didn’t realize you were there in your wife’s business. That’s the best kind of business traveler is my wife is out doing business. I get to travel along. That’s great. Kudos to you, bill. Good to have you back though.
[Bill] Thank you. And but again, that kind of gives you just a one little snapshot of how folks, yeah. It’s really interesting. Other countries are looking at how they’re gonna do business with the US.
[David] What about you? Think about what do you think about the whole situation related to Trump’s rhetoric? There was something that you were saying earlier that I wanted to go, oh. It was Powell the rhetoric with Powell. So Bill, when it comes to Trump’s disdain for Powell and how it take, would take an act of Congress to get him out, or if he tried to fire him, it’s gonna go to the US Supreme Court. Got it. But, and, how do you, any idea how you see this playing out? And I’d love to get all the panelists on that.
[Bill] So there are a lot of things with the Fed that can be substantially changed and upgraded, but the comment that I heard that it resonated is show me a stable first world economy that does not have an independent fed where, the flip side is where the, find me a stable economy where, the president, the king, whatever, has total control over monetary policy, they don’t exist and they’ve never existed for a reason. and this would be one where I draw a line in the sand and say, okay if you wanna have a longer term discussion about the Fed and its purpose and mandate, that’s fine, but it’s gotta be a bigger consensus and not, I’m going to change out the head of the Fed because I don’t like them.
[David] Let Marc jump in. Mark. Yes.
[Marc] Yeah, let me chime in. I got a lot to say about this, so I’ve, I’ll talk faster than normal. I don’t agree with everything Trump does, but I believe our Fed Chairman has been a nightmare the last couple years. Okay and the problem we got, we should never have a position in government where somebody is at Auto Thomas and can do anything they want to do and they know nobody can get rid of them and we need to refresh the system on how we get people in positions like that and maybe the simple thing is make Congress be able to push them out, but for somebody to be in a job that can do any damn thing they want to. I understand where Trump’s coming from and I think he’s a little bit overzealous on how he’s handling it, but I understand where he is coming from ’cause we got a guy that’s gonna do what he damn well pleases and doesn’t really care whether he gives you a good explanation or not and it’s, he’s looking Trump straight in the face and you might be the president of the United States, you might got the boast amount of votes, but in the damn thing you can do about it. And that’s what the dialogue is going on and everything that Powell does and senses Trump more. So I think we need to change the whole system whether we take the president of the Reserve banks and make a committee outta limb and they control rates, whether we have Congress approve the people that go in that position, I wouldn’t want that job. Most of us wouldn’t. But they gotta do something about that. But it’s this thing that’s that piece. But I’m gonna go over to this Tara piece. I’ve just got contacted by a group that puts consultants out to help people and there’s a group investment company looking at the manufactured housing business and I gotta have a call with them tomorrow to talk to them about what the tariff cost is gonna do on manufactured housing in this country and most of you on this phone would probably say, oh, mark, that’s not nothing major. Think about it. The steel in the frames come from China. The wood in the building, the frame the upper frame comes from Canada. Okay. 60% of the other stuff that goes to put the thing together comes from China. The only part that really comes from anywhere in the United States major part is the siding and the roof that goes on manufactured housing and the windows. Pretty much everything else comes from another country and we got a housing market there, we gotta keep manufactured housing cheap for the lower income and affordable housing, and we’re not gonna be able to do that if this stuff comes in and these tariffs keep building up from China, which they were at other places. I think what Trump is trying to do is find the best trading partners that we can have where we equalize the tariffs, where our people in this country get the best possible deal. I. I think what, that’s what his bottom line goal is now. Is he going about it the way I would, not necessarily Is it gonna be effective? I don’t know. But at least he’s doing something. He’s doing something and anytime we have a, anytime we have a political grouping that’s that’s willing to set a system together, let somebody like Powell be in office as long as he wants to be, rather than when we want him to be out and a group in office, let other countries charge any kind of tariff they want to on us and not protect our economy that produces things that can be used in inside of that. I think our President is trying to look out for us and say, we need to protect our manufacturers here to produce products for us and quit obeying. Yeah. This subpar stuff overseas. So I don’t really have a problem with Trump’s What Trump’s doing. I have some issues on how he’s doing it. Yes. And I certainly agree that Powell’s gotta go. So we’ll see how it hands out. Yeah. That’s my 2 cents worth. Thank you guys.
[David] Yeah and then Kittle, I know you agree that Powell’s been particularly a problem. The Fed, generally speaking, has worked across purposes with leadership
[Kittle] Any times, and we’ve talked about that privately. But love to get you weigh in on this. I got two tangents to take us on too, which will tie back into the whole comment here. But look, Powell’s been slow to cut and two fast to raise and he hasn’t done anything well since he’s been in there. So he needs to go. I’m all with Marc. Couple of things that haven’t been brought up here that weren’t noticed for the first quarter, DH Horton, which is one of our largest publicly traded home builders, missed Wall Street expectations. They sold 15% fewer homes in the first quarter in the same period last year. That exacerbates the inventory issue that we had Inventory issues, yes. Happening to them. It’s happening to everybody else, so that’s something we. Watch on in the reports later in the week. Second thing is, anybody wants to comment about this? Mr. Pulte, not him. The FHFA director announced he’s gonna be, that the GSEs are gonna be pushing back a lot more loans coming through and I heard that is he wants to start looking at manufacturing defects. Guys, you better get rep and warranty insurance and look into it. And remember, you don’t have to put it on your entire portfolio. You can I put it on the At risk. Yeah, on your risk. So that came directly from Poey last week.
[David] Great point, David, because Arthur Priesthood has a program that, in fact, I met Arthur through you and it’s just a great guy. He’s got a program for that. We need to get Arthur back on here to explain that. Because of that statement, the statement that Bill’s making is that’s a shot over the bow. Get ready? Another war started. Alice, I saw you nodding your head as David was saying that on the put backs. So your thoughts
[Alice] It’s interesting. That’s what I was gonna cover on the legislative update, so I’ll save that for the next, I’ll save it for that.
[David] Okay, very good. Yeah, but I think it’s really interesting where where we going, Allen, any thoughts on the if any thoughts from you on this topic? I know we’re gonna come to your segment a little bit later, but in your thoughts?
[Allen] No, I think the opinions of all of our here are great and the reality is that we have constant up and downs. If you go back and listen to our podcast over the last six months, we keep saying the same thing every single time, which is, it’s like the same but different, right? get out there, Be a person, right? Don’t overburden yourself with too much tech. Don’t overburden your borrowers. Help find unique ways to close deals. Work with your underwriting team, work with the sales team. People are buying homes and people are selling homes. Let’s get out there and make it a unbelievable week.
[David] That’s what we do. We do repeat that regularly. What’s driving that discussion? It doesn’t matter. At the end of the day, it’s get back out there and produce and that’s absolutely spot on, which is a dream a drum that we consistently beat on. All right. Very good on that.