Click Here to Print

Wednesday, September 27, 2023


Scott Carrithers
George Morris • Chris Thompson • Sean Doherty • Kevin Doyle • Mark Tranckino
Natalie Regan • Aaron Stoffer • David Farris • Lonnie Harris Brian Schaff Jeff Macy
Josh Kiefer • Robert Schuyler • Tom Toburen •  Todd Czinege

US Treasury Market

Date 1 mo 3 mo 6 mo 1 yr 2 yr 3 yr 5 yr 7 yr 10 yr 20 yr 30 yr
09/20/23 5.39 5.48 5.53 5.48 5.18 4.86 4.59 4.52 4.41 4.64 4.45
09/21/23 5.38 5.48 5.54 5.46 5.14 4.85 4.62 4.58 4.49 4.77 4.57
09/22/23 5.38 5.48 5.54 5.46 5.11 4.80 4.56 4.52 4.44 4.71 4.53
09/25/23 5.39 5.47 5.53 5.45 5.12 4.83 4.61 4.60 4.53 4.83 4.65
09/26/23 5.39 5.46 5.55 5.46 5.12 4.82 4.60 4.59 4.53 4.86 4.67

The data in the table above is static as of the time it was pulled, so rates may have changed. Treat all data in this table and PMR as indications only and availability is always subject to change.   This information was pulled manually from sources we believe to be reliable. New source, as of 12/12/2022, Bloomberg, L.L.P.  As of:  close of business 09/26/2023

This Is Not Our Parents Interest Rate Environment

Happy Wednesday!  Yesterday, CNBC’s early morning program had a gentleman on set by the name of James Grant.  While you may have heard this guy’s name before or read one of his many articles he has written over the years, his opinion on interest rates is highly respected in our industry.

Grant’s message was simple, we have been conditioned for years to think, over the long term rates will always move lower (Bond Bull Market).  This mindset put us at ease as bank portfolio managers, knowing time will cure any pain felt by negative price pressures.

He reminded viewers not to overlook the long-term cycle staring us in the face, which suggests we may be on the front end of a Bond Bear Market.  Of course, there will be shorter up and down cycles along the way however, we may be in for future highs eclipsing current highs for the next 30-40 years.

The purpose of this message is not to scare anyone.  It is however, a great reminder of how important a barbell approach will be moving forward.  This strategy will prepare your portfolio for anything the market throws at you whether Mr. Grant is right or wrong.  The barbell will allow you to maintain cash flow in a rising rate environment along with longer yield plays to protect the portfolio from any intermediate down cycles.

We would encourage you to consider the tax-free BQ market for your longer duration yield plays and couple that with strong plain vanilla Agency MBS structures for the front-end cash flow.  Fortunately, there is no better time than the present to consider the Agency MBS market as not only are rates at decade+ highs, spreads are also at decade+ highs.  It is time to find some liquidity and capture these outstanding opportunities currently available to you.

If yield plays are more your jam, today’s PMR also includes a Tax-free opportunity that can get you 4.40% Tax free to the 2028 call and if not called, a 5.00% Tax free coupon at PAR having amortized the premium to the call.  Please reach out to discuss the rate environment, the barbell approach, any of the opportunities below or anything else that may be on your mind.

Thank you very much for allowing us to continue to share ideas with you during these very interesting times!

Best Agency MBS Opportunities


This information is intended for institutional investors only. The material provided in this document/presentation is for informational purposes only and is intended solely for private use. Past performance is not indicative of future results. This material is not intended as an offer or solicitation for the purchase or sale of any financial instruments.

•Not FDIC Insured •No Bank Guarantee •May Lose Value