[David] Matt Graham, thank you so much for that update. Be sure to sign up for Matt Graham’s mbslive.net service. You can do so by going to that website or clicking in our advertiser page and getting signed up. But when you do sign up, be sure to put in the LOL as the sign-up code for extended period without having to put in a credit card. You should just pull out your credit card and get signed up. It’s that good. Amazing service. So I’m looking at the date we open up and you turn on your computer and you watch this vertical line, Bill, go straight up. We just shot up this morning first thing, and now we see and not too long ago, about shortly after Matt finished hitting the record we see this nice green line down so lots of volatility today. I’ve got several questions for you, but let’s comment about today’s volatility and what contributed to it in your perspective and The bigger question is how are traders managing all this?
[Bill] So I wanna go back to a phrase Matt used in, right in the beginning, right? There’s a framework for a memo. For real. That’s like saying Tell me “I’m writing a book and I got a table of contents. I haven’t written the book yet but I got a table of contents.” Yeah. And then so bookend Matt’s segment. So then at the end of it, he has Trump saying maybe there should be less talking publicly about what’s going on. To be fair, he said talking. He didn’t say tweeting. Tweeting, yeah. Anyway. I don’t know. And one of the other things that I’ve heard talked about a few times with the Iranian side of what’s going on You need to understand that their method of communication right now among the senior leaders is the old pony express. Yeah. They’re literally having couriers handing off messages, dead drops, because they’re just so paranoid about being discovered. And you have antiquated communication and still not really clear in all those handoffs who’s actually the decision makers. Yeah exactly. I have a feeling that there’s another, unintended blow up before this resolves. I don’t think you can just be in this talking realm and then all of a sudden everybody’s gonna come up for fresh air and shake hands. I think it’s gonna be forced one way or the other. And now the whole Israel-Lebanon is becoming a big part of it. But I think Iran just keeps bringing other random things into the mix. I don’t see this- They just need- … being totally resolved, negotiated. Something’s gonna have to force the issue.
[David] Bill, you make up some really good points on this. I’ve got some thoughts I wanna throw at it, but let’s get Kittle in on this next. Mr. Kittle, thoughts on Where the markets are, how the markets are reacting?
[Kittle] I think the markets are flat. Our gas here in Louisville actually went below $4 a gallon this weekend. It’s at 3.85, and you can go to Costco and get it for under 3.60. So that’s a little bit better. It’s down 80 cents a gallon on hopes that things will be okay. We focused a lot here for the last few weeks, like everybody is, on what’s going on on Iran, and I think I’ve said it before and I’ll just reiterate to answer your question, reiterate it one more time. This is a mindset and a culture. And not gonna go in… They’re not gonna change. This is the drag out. I’m really surprised, and you know I love Trump’s policies and everything else that he’s doing. I’m surprised that we’ve been or allowed it to go and lead on this long.
[David] In other words, we haven’t brought them to their knees sooner?
[Kittle] We’re gonna have to go in and finish it because they’re not gonna do it. They’re always gonna find one thing we don’t like what Israel and Lebanon are doing.” Great. It has nothing to do with the fact that we just kicked your butt everywhere we want the uranium or whatever and we really want regime change. Yeah. And Trump has said this last week, the regime has changed two or three times ’cause a couple of them were killed, but that’s not real regime change because the people haven’t taken over.
[David] It’s the ideology. The ideology exists. As long as that does, there’ll be another one standing up and they’ll continue the regime change and it’ll continue to drag on and on.
[Kittle] They don’t care how many people die. Yeah, they don’t. And so the only way this is gonna get fixed, nobody wants boots on the ground, but you’re gonna have to go in- No … and finish the job. That’s it.
[David] Yeah. Marc, you used to work in intelligence in the military. Any insights to what do you think might be going on behind the scenes? I keep reading more articles about theory that there’s a lot more happening, substantively happening behind the scenes Which is why we’re seeing what appears to, what I would characterize as weakness. I don’t know what David would say. Why don’t we just go in and finish this thing? Your thoughts, Marc?
[Marc] Being a former military guy, I wish we would go in and finish it, but I also understand why Trump’s cautious about that, ’cause we’d lose a lot of American lives doing that. And I think he’s getting enough negative press on this thing. If he goes in and a couple hundred thousand US troops die he won’t go down as the guy that should be on statues in this country. Might not do that anyway right now. But anyway I got so many problems with this. This reminds me so much of the regime in Vietnam, Yeah, that’s what I was thinking about … so it just, It has a lot of that flavor to it, doesn’t Yeah, the reason why the Vietnam regime never fell from within was the same reason that Iran’s been that way. They got, had such a controlling factor on it, and everybody thought we were 100% in support of the Vietnam regime, but we understood how bad it was, but we thought it was less bad than the communists from up north were. But in fact, those people were treated like crap the whole time I was over there. So I don’t know. I just don’t see us going into a full-fledged conflict, and that’s the only way we’re gonna end this thing, to do it, and, we’ve already destroyed the infrastructure that’s there. I don’t think they got any leverage anymore in negotiation with us. The fact that they were trying to get reparations for what we destroyed over there I thought was a frigging joke. If we blew all that up to get where we wanted to go and then pay them back for it I think I was gonna move to South America or something, ’cause that would be the most ridiculous thing I ever heard of. But I know we gotta stop the nuclear side, we gotta get control of the uranium, and we gotta do all those things. But somebody’s gotta make a hard decision, and I think Trump’s 100% right if he sticks to it and us going silent, ’cause the more people talk about it, the worse he looks and the worse the administration looks for not taking action one way or another. Of course, one side wants us to completely get the heck out, and the other side, the other rest of us want to get it, let’s get it done. I’m a believer you don’t go in war unless you go in with intent to win, and I think we thought we could pull a bluff on them, and it didn’t work. We did so much, and we said, “Look what we can do to you,” and then we dropped the ball. And this thing should’ve been over a month ago, a couple months ago.
[David] My opinion only. That’s what I would think. Alice, your thoughts as you listen to all this?
[Alice] I agree with what Mark said. As a matter of fact, I’ve had family in the military who expressed the same thing. So I think for me and for our discussion here, I’m I’ll let you guys get into all the politics and all of that. For our listeners, it just continues to be, from a market standpoint, something that we just can’t predict one minute to the next, and I think that’s gonna be our biggest challenge is, it was always rough in mortgage banking to even look 60 days out or 90 days out, and now it’s very difficult to even manage 30 days out- with the fluctuation in pricing right now.
[David] Also, that at the pump. Kittle was talking about that earlier. It’s just what we’re all paying at the pump, it’s, I had to pump premium into the Lexus we’re driving and that was nearly five, by $4.99 at the pump I was at this weekend. And I’m going, “Meow.” Even me noticing it. We can fill it and we can afford it and we’ll do it, but it, this is gonna have, start turning unpopular at some point in time where it’s going on longer than most feel it should have or could have. So I think a lot yet to be seen. What we do have, Alice, to your point, is volatility, and we’re gonna manage that volatility and how you handle it. What’s really interesting, Alice, is how many are reporting overall optimism and their pipelines are doing okay. Yeah, if you have a big spike in the rise of rates, it may put a pause in it. I always look at it the metaphor for me is like I look at the markets, it’s like everyone’s scuba diving. You’re down about 100 feet or you’re down 70-some feet, and all of a sudden a large fish that looks like a shark, maybe a porpoise, it goes through the water. And all of a sudden everyone sucks in, and there’s this long gap in the bubbles, the relaxed bubbles going up. There’s just this, ooh, and they suck in, and then they hold, then all of a sudden they see, oh, it’s only a porpoise or it’s only a harbor seal and whoosh, you let out all this air. We have these moments where you don’t know what to believe, and we’re all, “What should we do?” And then, “Ah.” We’re having enough of those moment. There’s fatigue that’s gonna set in about that, but we can’t let that set into our business practice because people are out there buying homes. this market, I am convinced, is gonna … There’s more evidence every single day that this market is gonna take off. The question is if you let the fatigue take you out, then you are not gonna be as effective when the opportunity really does happen. And so I think you raise a really good point on that. Mr. Pollock, any thoughts you wanna add and contribute to that? Then we’ll go back to Bill.
[Allen] I don’t know, honestly. I think we all would like to see this conflict come to an end. Oh, yeah. The news- And no troops … is just really difficult to follow, and it’s really difficult. Every day it’s something else, and there’s, I hate to use this word, there’s fake news coming out everywhere because some people say that they’re, one outlet says that there’s negotiations are going great. Another one says that Iran ref- refuses to be part of the negotiations, and the next one says, “Oh yeah, Donald Trump agrees, and they- Yeah … yeah, they refuse, and they…” We’re back and for- every day it’s something different. Let- let’s just move on. Yeah. Move on. There’s nothing we can do about it. Let’s- Move on or what? We’re… Yeah. It’s crazy.
[David] Yeah. Bill, you had a l- final thought and we’ll move on.
[Bill] Yeah. So I think, and it plays right off of what Alan said, right? Instead of, especially, and this is geared toward the sales side of the audience, right? Focus on what you do know and where you can add value to your customers, and it’s paying attention to specific things. For example, if somebody already has a high DTI and it’s a purchase, you might wanna have the conversation about locking in their rate so that they don’t wind up- if they qualify by locking in the rate, yeah … a week before closing not being able to qualify for the house they wanna buy. Could rates drop and maybe their payment would’ve been 10, 15 bucks a month lower? Yeah. But is it worth playing roulette with whether you still qualify for your house? Have those kind of conversations with your customers. Okay. Don’t speculate on the things that you really don’t know what you’re talking about, ’cause you’re not different. Nobody does, I can’t tell you, where rates are gonna be tomorrow, next week. And now if somebody’s playing the long game, okay. It can float. But if you’re talking about purchase customers, when they’re gonna close- where they are in the qualifying spectrum, pretty important.
[David] Yeah. And I think you bring up a really good point, Bill, ’cause especially for those borrowers that are on the edge. They’re on the edge. A slight bump in rates where they could have locked and qualified, and it’s just a, enough of a bump and now they can’t, and now they’re under pressure, and so to perform the contract you’ve gotta lock and they can’t qualify. It’s just a time where we’ve always said, “When you have a deal, what’s the one thing you should do? Lock the loan. Get it done. If you can get it done. Get over, past it.” Thanks everyone for your thoughts and contributions on that.