- 3 days ago
Today, HousingWire's CEO, Clayton Collins and Lead Analyst, Logan Mohtashami, will talk about the Government dropping the probe on Fed Chairman Jerome Powell, paving the way for Kevin Warsh to be Chairman. We also go over some recent housing data and talk about the BIG event in Austin, Texas — The Gathering — and why it's important.
Related to this episode:
DOJ drops probe of Fed Chair Jerome Powell
https://www.housingwire.com/articles/doj-drops-powell-probe-warsh/
HousingWire | YouTube
https://www.youtube.com/channel/UCXDD_3y3LvU60vac7eki-6Q
More info about HousingWire
https://lnk.bio/housingwire
To learn more about Total Expert visit totalexpert.com
The HousingWire Daily podcast brings the full picture of the most compelling stories in the housing market reported across HousingWire. Each morning, listen to editor in chief Sarah Wheeler talk to leading industry voices and get a deeper look behind the scenes of the top mortgage and real estate.
Related to this episode:
DOJ drops probe of Fed Chair Jerome Powell
https://www.housingwire.com/articles/doj-drops-powell-probe-warsh/
HousingWire | YouTube
https://www.youtube.com/channel/UCXDD_3y3LvU60vac7eki-6Q
More info about HousingWire
https://lnk.bio/housingwire
To learn more about Total Expert visit totalexpert.com
The HousingWire Daily podcast brings the full picture of the most compelling stories in the housing market reported across HousingWire. Each morning, listen to editor in chief Sarah Wheeler talk to leading industry voices and get a deeper look behind the scenes of the top mortgage and real estate.
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NewsTranscript
00:09i'm clayton collins ceo at housing wire and can be more thrilled to take the mic today on housing
00:15wire daily logan modashami thank you for joining me as my guest on housing wire daily it is pleasure
00:21to be here you know we'll get sarah wheeler back next week but it's been a fun week with you
00:26brenna and myself running the show let's rock it before we jump in i want to thank our sponsor
00:31total expert for making this episode of housing wire daily possible thank you total expert
00:37now logan let's jump into it today we are launching the gathering so this is the gathering monday in a
00:44few hours the gathering officially kicks off it's going to be a huge week i want to talk more about
00:49that a little bit later specifically about what you're going to bring from stage but before getting
00:54to the gathering i think we have to address the massive news that that dropped on friday the
00:59breaking news that came across the wire from housing wire as well as um cnbc and bloomberg and everywhere
01:04else uh you get your financial news the doj dropped the pal probe what does that mean logan well you
01:12know trump always likes to play bully ball but you know with tillis and the senate kind of holding
01:18uh warsh as a confirmation hostage for this uh he just finally had to pull the trigger uh if he's
01:26serious about having warsh get in there as soon as possible he needs to drop this uh probe and um
01:33this whole crazy episode which really started kind of last year shadow fed president we need
01:40emergency rate cuts all this back and forth uh that tenure will come to an end soon for jerome powell
01:48as the confirmation hearings will happen and uh kevin warsh will be approved and then we start a
01:55whole new chapter with a no new fed chairman that is going to be very very interesting uh from my
02:01perspective what do you think the timeline looks like from here when do you think the confirmation
02:05hearing will be scheduled do you think he you know warsh gets through or we have a few more rounds
02:10of
02:10um this uh this intense questioning that we saw last week so traditionally you let your fed chairman
02:18kind of get through and he's he's got the votes for it so uh powell's tenure i believe ends in
02:23may 15th so
02:24look for you know uh fed chairman kevin warsh is starting from uh the second half of may
02:33and we go on from there right it's gonna it's gonna be a whole new ball game in the sense
02:38uh of having a
02:39fed chairman kind of in line with what the president wants but you know we talked about this in our
02:44last
02:45spot there's limits to what he can or can't do uh but this is it for uh jerome powell what
02:51a
02:51a crazy period post covid uh with all the crazy stuff that have happened that have not traditionally
02:59tied to economic cycles but here we are and i think it's better for him to just kind of retire
03:04and go
03:04watch grateful dead concerts and enjoy his life and then to deal with all this drama he's had to deal
03:11yeah because that's still on the table right he could stick around as a as a um a member of
03:16the
03:16voting committee but even though he's not chair correct he could i i just think powell kind of
03:23made sure that you know he was gonna he was gonna hold that as his hostage thing that hey listen
03:29i'll
03:29just be a fed governor uh president trump wants more votes he wants more people aligned with him
03:35because the fed the the the voting structure really matters for the for the red rate hikes and
03:41rate cuts but in this light i think powell will just kind of move along uh uh and uh you
03:47know even
03:48though the lisa cook thing is still up in the air and uh we have other fed governors that might
03:54might
03:54turn it i think this is a good ending for him just to move on to the next stage of
04:00his life which
04:00will probably be a lot of public speaking yeah yeah i've been watching the the cal she markets all
04:05morning on the the wager of when will kevin warsh be confirmed as fed chair and it's pretty wild how
04:12the the data shifted um you know in the in the minutes preceding the news breaking um but now we're
04:19looking at at odds right now we're only two like right now as we're recording this might may change by
04:24time we drop two percent chance of confirmation before may 1st 82 percent chance of confirmation before
04:30may 15th um uh uh 96 chance before july 1st so i mean i guess it could drag out but
04:38uh it's pretty
04:39interesting uh is it possible to actually confirm before may 15th or is the i mean he can get he
04:44can
04:45i mean they can i think they're gonna vote next week uh uh so the confirmation is it's the tenure
04:51of
04:52powell ends may 15th so even if he gets confirmed uh uh that's powell's last day so kind of just
04:58gotta think of it as the second half of may and that's where kevin warsh will get in and
05:03we'll start a whole new uh process with the fed after that yeah no i mean it's you know this
05:08is a
05:08new chair but it doesn't change the the construct of the voting governor so it's not a a guarantee of
05:15a
05:15policy change um early in a in a fed tenure right yeah it you know with with warsh one of
05:23the things
05:23that you know i talked about on our last podcast is that he's going to be much more dovish uh
05:29than
05:30powell um but there's limits to what he he can do i think if there was if there was some
05:36real weakness
05:37in the labor market taking it to the next stage from low job growth to jobless claims rising i think
05:43that's where uh kevin warsh will be more forceful uh as long as trump is president uh in terms of
05:52trying
05:52to get everyone on board for more rate cuts in that i think that's going to be you'll have a
05:57more
05:57dovish fed chairman now especially after the press meetings uh you you have a fed chairman that has
06:04actually talked about the housing market needing assistance where powell is kind of deflected from
06:09that uh so things will be different but you're still bounded by the laws of the fed governor's voting
06:16uh structure so uh we will it'll it's going to be a very very interesting rest of the year now
06:22with
06:23kevin in there and what's going on with the conflict in iran and inflation and the labor data so we
06:30we
06:30have a lot going on so it's it's going to be a fun-filled exciting headline uh uh day to
06:37day in and
06:38day out for the rest of the year and we know the bond markets are very forward looking so what
06:43do
06:43what do you think we're going to see in the the spreads and mortgage rates coming out of um you
06:47know immediately following this this dropped doj probe or uh or or no impact at all you know kind
06:54of we didn't see too much impact i think there's a lot of other things that are running the 10
07:00-year
07:00yield uh currently of course i mean i can make a case that if there was no iradian conflict at
07:07all
07:07the 10-year yield being between 425 to 431 looks perfectly acceptable if the jobs data isn't getting
07:16worse with inflation above target so if you didn't have kevin warsh if you didn't have the iranian war
07:22where the 10-year yield is at right now you know with inflation where it's at it looks perfectly
07:30acceptable so uh i think the question going out in the future is hypothetically speaking let's just
07:36say there was an end to the conflict and everyone believed it and ships were flowing does the 10-year
07:42yield go too much lower right now if the labor data is stabilizing uh you know we we always get
07:48to
07:48about 424 around there when we get ceasefire news but the question is if the jobs data is producing 30
07:55to
07:5560 000 jobs uh is that good enough to keep the 10-year yield above four percent but now with
08:01kevin
08:02warsh when he comes in how is he going to look at that once the conflict is over so you're
08:07going to
08:08get a lot of interesting infighting with the federal reserve now which was it which really isn't
08:13traditionally the case uh but i think you'll have more open-ended uh uh fighting between the kevin
08:20warsh's of the world and and austin goolsby or laurie logan or beth hammock uh which will be which
08:27will be the first time we might see open conflict uh with federal reserve members in in a bigger
08:33fashion than we're accustomed to yeah it'll be interesting to see if the communication channels
08:36look any different or the timing of of meetings and guidance change it all under under a new chair
08:42i think kevin wants to change a few things so it'll be interesting to see what happens it'll be
08:48interesting to see the fed speeches after his uh tenure uh or after he comes into to power in that
08:56sense
08:56uh but you know there's clearly a divide with the fed you know there's a michelle bowman's the
09:01christopher waller's the steve stephen myron and then uh kevin warsh versus uh uh the rest because
09:08there's there's more hawks than doves right now but the hawks are kind of staying flattish in terms of
09:16not asking for higher rates at this point just we don't want to cut until you know we get some
09:22clarity on the war stuff like that which you know once the war is over you know things will start
09:28clearing up the clouds will kind of move away we get a little bit better vision on the labor market
09:33inflation and how the fed wants to address that but clearly you're going to have a very uh pro trump
09:40fed chairman who wants more rate cuts who wants to help the housing market uh but you're probably
09:47going to get someone more aggressive if the labor data gets weaker from this stage uh and i think
09:52that'll be interesting to see how he's able to work with other fed members if if that is the case
09:58because right now the labor data is stabilizing not getting worse the things that the fed has already
10:03talked about so it'll be interesting yeah okay so you know piggybacking on the the fed conversation
10:08give me a glimpse into what you've seen in some of the the mortgage data this week what have we
10:12seen
10:12in purchase apps uh let's go to inventory from there well purchase application data positive 10
10:18uh week to week 12 year over year that was kind of the trend this year if you take away
10:25the snow data
10:26and you take away the like the initial war data when rates were elevating towards 6.64 percent
10:33we were getting positive week to week and positive year over year positive year over year double digits as
10:38well i we had much harder comps to show double digit growth uh this year than last year so that
10:44surprised me a little bit but if you take away the holidays snow and the war out of the equation
10:48this is what purchase application data kind of were was going to have positive week to week data
10:53but uh positive year over year we didn't actually have one negative year over year print until the war
10:59started even with the snow data because the snow data only impacted a few a few states but uh we'll
11:05see
11:06if that's to me it's like the sweet spot for mortgage rates over the last two years when rates
11:11get near six percent just stay there we've never been able to have that up until you know late last
11:18year and going into this year actually going into this year volatility was compressed mortgage spreads
11:23were compressed uh we had it was a really good healthy backdrop on the rate side and then the
11:29conflict happened and then you know a lot of things got more wild then but uh purchase application
11:34data kind of looked like what it was you know uh before the conflict and we'll see if that continues
11:39itself going out in the future yeah the stability in in rates data seems to be incredibly important
11:45for for consumer confidence it seems like the consumers the the home buyer and you know and the
11:51sellers get get skittish whenever rates start changing quickly so this like this trend we've seen
11:58you know it's a it's a vote of confidence for the consumer mindset you know we were so spoiled in
12:03the
12:03last decade because we didn't really have much volatility outside of 2013 uh when rates went from
12:10like three and a half to 4.75 in a very short amount of time um so people are just
12:15used to rates
12:16being more stable and then you know chaos happened after 2022 but what i've seen in the data i think
12:22what most people see in the data whenever we get now to near six percent data get improved and then
12:28we just have a violent reversal in rates to above seven percent and that was common all the time and
12:35part of that was mortgage spreads mortgage spreads were not close to normal again so you can have
12:40those kind of moves but now not the case and i think one of the things i've made a big
12:47emphasis
12:47in trying to teach people about the spread is that when the spreads get closer to normal we always talk
12:51about the slow dance right between the 10-year yield and 30-year mortgage rate but when the spreads
12:55are normal it's more intimate slow dancing that means it's less volatility to the upside so even
13:01with the war conflict the 10-year yield got as high as 4.48 but mortgage rates never got above
13:076.64
13:08uh and the peak of my forecast this year was 6.75 just because of the spreads and that's you
13:14know not
13:15war related so i think you you saw the volatility compress even with rising inflation even with the war
13:22aspect a lot of that has to do with the spread so a lowest mortgage rate curve going into the
13:28first
13:28half of the year but also kind of less volatility because in 2023 2024 and 2025 we'd be over seven
13:36percent in some cases above seven and a half percent or even in the low sevens or high sixes we
13:41quite
13:42never got there and now we're kind of the spreads are getting better now so less volatility i think a
13:48lot
13:48of people see that in the last few days positive for everyone right housing could operate better
13:52mortgage people or real estate people can operate better when there's less volatility and then people
13:56feel a little bit more comfortable about putting their homes on the market you know because you know
14:01they see that's where rates are at they're comfortable with selling that house and buying it with another
14:05mortgage uh with rates they're positive those are all healthy positive outcomes for the housing market in
14:122026 we talk a lot about data as the anecdote to fear if i'm an originator or an agent right
14:17now and
14:18i'm you know trying to help a client be comfortable with the market we're we're nervous that now is a
14:25good time to to buy or or list a home what are you advising originators or agents to focus in
14:32on
14:32what's the data that they need to be most attuned to to help bring confidence to the transaction well
14:38number one the tracker data is designed to give the whole enchilada of what's really going on in the
14:43housing markets but that's on the national side uh always kind of look into your own area because of
14:50course new jersey is different than louisiana orange county is going to be different than minnesota so
14:56uh local area is going to have a different take and that's why housing wire intelligence was created
15:01for everyone to let me teach you how housing economics work but also get the data for your own
15:06area so you can provide that for your real estate agent or as a realtor provided for your seller for
15:13your loan officer provided for your buyer be that source don't let ai take this away from you you have
15:20the ability because you will have data to your fingertips 24 7 out there so i think that's that's
15:27the job is let me do the nerdy economic teaching but the data is there housing wire intelligence get it
15:33you
15:33have access to stuff that people just don't have access uh uh in in previous years yeah i will uh
15:40i
15:40wasn't planning on doing this but like the team at housing wires had a little bit of advantage we've
15:44been in our um beta instance of housing wire intelligence for a few months and uh only our team
15:50members uh the exec team i think have seen the the mobile app that we're we're launching this week so
15:56if you're a housing wire daily listener you're actually hearing this before before anybody else
16:01don't tell my product team on video you can see we have this brand new mobile app experience that
16:08brings news as well as housing wire intelligence all the all the data right to your phone as an
16:14executive um i i'm probably on my phone 80 of the time and desktop 20 like so mobile is critical
16:23for me
16:24and you know after years of being so reliant on the wall street journal app and bloomberg app like
16:29pretty pumped to be able to bring housing wire to my to my home screen and um have all the
16:35data that
16:36logan's been referencing uh for years at our at our fingertips not just nationally but down in my zip
16:42code and um you know that's you know as a as a homeowner and someone who uh you know it's
16:47self
16:48proclaims spends way more time scrolling listings than i do scrolling sports scores uh it's pretty exciting
16:54to have a housing wire at my fingertips right now understand what's happening in my zip as well
16:58as as well as nationally yeah i think um access to data and then also being able to explain it
17:05and
17:05give it some context is always the key you know that's kind of been my thing for the last 15
17:10years
17:10is try to bring context to the history now not a lot of people like history i love history of
17:17course
17:17and uh the history of housing economics for the last 84 85 years does tell you a story each cycle
17:24is
17:24unique of course uh the whole housing dynamic shifted after qualified mortgage went into play but
17:29uh show the data explain the data give everyone confidence on what's going on millions and millions
17:37of people buy homes every single year you have near 5 million home sales at 2023 2024 2021 we could
17:43maybe have a little bit uh more than that this year uh so there's always going to be demand there
17:48but
17:48your access to demand and teaching people this uh gives you a light that you know you know imagine
17:54this 20 years ago no we didn't have uh access like this available for the for the public but uh
18:00use it learn from it be the detective not the troll all right logan when are you taking the stage
18:06of
18:07the gathering when's your session i'm gonna actually be on uh i think monday and wednesday uh sarah and i
18:13are going to be doing a uh night podcast and then wednesday um a morning i'll be uh uh giving
18:19my
18:19presentation and my job morning keynote yep yeah the keynote will be a wednesday morning my job is to
18:25explain everything that just happened because you know none of us had a war economic theory
18:30into 2026 and we get to test what this does to the housing market with the rates going up in
18:37a quick
18:38fashion but not as high as it used to be so what does the data look like now when we
18:43had a initial
18:44test to higher rates which is to me right now looks a lot different than what it used to be
18:50just because
18:50rates never got above seven percent and we're going to go into the whole structural dynamics of
18:55uh kevin wars what what realistically can or can't happen we go over we're going to go over mortgage spreads
19:00the confusing thing is inventory this year places like florida is down year over year noticeably
19:07dallas and austin are not growing inventory so my job and what i'm going to do on wednesday is to
19:14really talk about the housing dynamics now at what stage we are in the cycle because it's much
19:20different when inventory isn't working from savagely unhealthy low levels in 2022 to where we are now
19:27it's kind of a normal housing market so the structure dynamics around the economic cycle is going
19:32to be a little bit different we're very excited because you know we talked about last year in
19:37mid-june that the housing market is shifting it'll probably take six to nine months for people to
19:41get it we're here past that nine months and now we get to visually show everyone and explain to
19:46everyone what is going on at this very second after the war conflict and what to look about in the
19:52future
19:52with a new fed chairman so um we talked about calci markets earlier on the fed chair i got an
19:58idea
19:58that logan uh inspired by a poll i saw on social there's some people out there talking about the
20:03probability of what color shirt you wear on stage do we need a polymarket um uh prediction here on um
20:11you know people actually gonna bring yeah people throw up ideas for me so i let the marketplace decide
20:16i said okay you guys decide what color shirt it is uh uh and uh uh i got i've got
20:22a lot of different uh
20:23different answer so i guess i gotta pick one unless one really sticks out so well i i mean i
20:28have not
20:28set up a prediction yet on polymarket or calci been playing around with a few uh as a as a
20:34participant
20:34but not as a uh as the person running one but i might need to see if i can figure
20:39this out we could
20:40have some um yeah some interesting wagers or predictions going for yeah yeah for next week just
20:46keep it out of certain traders hands before it comes out you know yeah it's one might try always
20:51someone out there that knows ahead of time to work the market yeah someone's your your bag's gonna get
20:56stolen out of a baggage claim to influence the outcome there uh so logan outside of your your
21:02session what else should we be looking forward to next week or any other speakers or sessions that
21:07that have you excited yet you're going to be um you know tuning in for well i think you know
21:11having
21:11scott turner there uh uh and you know you know how i always talk about the gathering is that it's
21:17the
21:17one event where you get top mortgage people and top real estate people and top government officials
21:22all into one place right so you don't really usually have that at event and i think it is good
21:27for the
21:28head of the hud to basically talk to you know the the the two constituents of of of who he
21:33kind of
21:34hundred percent yeah and i think in that light it'll be very interesting to hear what he says you always
21:39want to hear what the new ai technology or what's going to go on with listings and see different
21:45perspective of of what how executives are are moving in this market both in real estate and
21:51mortgage so that's always all the sessions are very unique and that is very informative and then
21:56the chart daddy's going to come in and bring some economics uh into the mix so uh it's good that's
22:02why
22:02i think the gatherings is always sold out i think it's always had a a good reputation that you know
22:07you
22:08get the best of the best and they're willing to talk so that's a good thing it's a it's a
22:12funny
22:12event i mean my my strategy for this one is to build the davos of housing i think davos is
22:17such a
22:18an aspirational gathering of world business leaders and it's not just it's talk it results in
22:24in action and outcomes and that's the vision for the gathering when you bring together
22:30operators capital and policy into the same room you actually have a an opportunity to not only
22:36understand but like drive action um for yourself and for the industry come coming out of the event so
22:42when you put it through the davos housing frame like i'm ready to like you know put on the gray
22:46suit throw on the tie and like and be uh you know as buttoned up as possible which we do
22:51to an
22:51extent but uh our audience our community um is a fun loving group so we uh we have some great
22:58i don't think i don't think i could get away with a silk shirt in davos it's too cold up
23:03there so
23:03you know that's fair um well you know it's cnbc commentators throw on a fur coat on top of the
23:10silk shirt it seems yeah so maybe maybe that's the uh maybe that's the approach all right housing
23:15with our daily listeners thanks for tuning in thanks for letting me hijack the mic from
23:19sarah wheeler uh while she's got a few days off logan thank you for being my guest um for those
23:24of
23:24you that are here this week at the gathering please come say hi uh one of the other reasons we
23:30love
23:30our events as we get the chance to take these digital relationships um and you know make it a
23:36two-way conversation and meet people and shake hands in person so um i hope to see you this week
23:42at the gathering logan yes see you all in austin can't wait
24:07you
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