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No Truth Coming From Mortgage Bankers Ass.

Apparently the MBAss (Mortgage Bankers Association) didn’t like the fact that someone in the financial blogo-wackosphere actually had the temerity to make use of real, hard data, that they hadn’t massaged. Now, not only do they not report the actual index level of their seasonally smoothed applications indexes, the charts of the not seasonally adjusted indexes have disappeared from in the past week. I doubt that Bloomberg would have pulled them on their own. Seems more likely that the MBAss wasn’t too happy about anyone actually reporting the truth. So unless Bloomberg relents or I can find the data elsewhere, it looks like last week’s report will be the last time we get to see what the actual purchase applications look like.

For now, I’ll return to looking at the seasonally smoothed data which, while not the actual numbers, should give us an idea of the trend. The MBAss stopped reporting the actual index levels about a year ago, but they still report the weekly percentage changes, so it is possible to reproduce a close approximation of their index.

Of course, if the news gets bad enough, like if purchase apps drop to new lows, they can always stop publicizing the data altogether. These are after all, the very same people who brought us the housing crisis in the first place. Things like fudging, lying, cheating, stealing, and committing fraud are part of their natural order. Getting the truth out–not so much. In fact, before joining the organization a prospective member needs to pass a sociopathy test.

Chart Removed by Demand of Mortgage Bankers Association

The seasonally adjusted mortgage purchase applications graph broke a long term downtrend line this week, but it remains below the one year moving average, which is flat. While the trend of purchase applications has apparently stopped weakening, it hasn’t turned up. Comparing the week ended November 4 with the same week last year, applications are down 2.9%. They remain down over 65% from the May 2005 peak. Furthermore, taking into account the 18% of deals that the NAR is reporting have recently been falling through, versus 9% a year ago, and an increase in cash deals of about 1% since last year, effectively purchases are down by around 11%.

That’s not the news the housing industry wants to hear, and certainly not news it wants potential market participants to hear. So organizations like the MBAss do their best to hide it, because it’s the truth, and from their perspective, you can’t handle it. ___________________________________________

This Week Will Tell If The Bear is Really Coming Out of Hibernation

Last week’s selloff did less damage than it may have felt like. The drop stopped in the area of 3 crossing uptrend lines, ranging in length from short term to long term. Here’s what would tell us whether the uptrend is still in force, or signal that something evil this way comes. I have added 8 new stocks to the swing trade chart pick list, including 2 shorts.

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Lee Adler

I’ve been publishing The Wall Street Examiner and its predecessor since October 2000. I also publish, and was lead analyst for Sure Money Investor, of blessed memory. I developed David Stockman's Contra Corner for Mr. Stockman. I’ve had a wide variety of finance related jobs since 1972, including a stint on Wall Street in both sales, analytical, and trading capacities. Prior to starting the Wall Street Examiner I was a commercial real estate appraiser in Florida for 15 years. I was considered an expert in the analysis of failed properties that ended up in the hands of bank REO divisions, the FDIC, and the RTC. Remember those guys? I also worked in the residential mortgage and real estate businesses in parts of the 1970s and 80s. I have been charting stocks and markets and doing analytical work since I was a teenager. I'm not some Ivory Tower academic, Wall Street guy. My perspective comes from having my boots on the ground and in the trenches, as a real estate broker, mortgage broker, trader, account rep, and analyst. I've watched most of the games these Wall Street wiseguys play from right up close. I know the drill from my 55 years of paying attention. And I'm happy to share that experience with you, right here. 


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