Democracy must be something more than two wolves and a sheep voting on what to have for dinner. (James Bovard)

Speaking of Democracy, two weeks ago I addressed an audience at Cal who was interested in investment decision making. The majority of the classroom was filled with students to whom English was a second language. They were eager to learn everything that they could about the bond market, interest rate movements, etc., but their overriding concern was if Democracy and Capitalism were going to survive. I told them that in my opinion it would survive, as it had through Roosevelt’s New Deal, the Depression, Ivan Boesky, and many other events – it seems to evolve, but people still want to be financially rewarded for their efforts with a minimum of government intervention. They seemed relieved. (Hopefully they owned some Wells Fargo stock – see below.)

If you like numbers, and population trends presented in an entertaining way, check out http://www.youtube.com/watch?v=jpEnFwiqdx8 (For example, India has more “honor roll” kids than the United States has kids!)

Can you only get to your cabin in the summer? If so, GMAC won’t allow secondary financing. “GMAC Bank Correspondent Funding (GMACB) Approved Correspondents please note that GMAC Bank has discontinued financing for seasonal second homes defined as those that are not suitable for year-round occupancy.”

GMAC Bank Correspondent also noted that for Non-Delegated Correspondents, they stated when a second appraisal is required and the party that may order the second appraisal. A second appraisal is required when all of the following criteria are present: Base loan amount exceeds $417,000 and base LTV is 95% or higher and the property is determined to be in a declining market. A second appraisal is also required for all cash-out refinances where the base loan amount exceeds $417,000 and the property is determined to be in a declining market. “For loans registered prior to April 1, 2009, where Cash Out is over 85% LTV, a 2nd appraisal is also required.”

I bank at Wells Fargo, and I am sick of it. You can’t walk through the door without having a greeter ask you about your day, offer you cookies, and have the tellers fight over who is going to assist you. I expect that one day I’ll walk in and they’ll offer me part of the Wachovia servicing portfolio. Speaking of which, Wells Fargo & Co., the second- biggest U.S. home lender, said first-quarter net income was about $3 billion and that results at Wachovia Corp., acquired about three months ago, were exceeding expectations. How can banks, which are borrowing at 0%, and able to sell their mortgage production to the government for nice profits, not make money? Their stock this morning is up over 20%.

In other news, overnight Asian stocks rallied on a Japanese government stimulus plan. Jobless Claims fell more than expected last week, but so-called continued claims scaled another record high in late March: Initial claims for state unemployment insurance benefits fell 20,000 to 654,000 in the week ended April 4, from an upwardly revised 674,000 the week before, the Labor Department said. We also had the trade numbers: our trade deficit shrank by over 28% in February to its smallest since November 1999 as imports tumbled and exports managed to grow slightly in the face of shrinking global demand. We still have an $18 billion 10-yr Note sale to get through today, and the supply issue is weighing on rates somewhat – as is the early close for bonds. (The bond market is closed tomorrow.) The 10-yr is back up above 2.90% and mortgage prices are giving back some of yesterday’s pricing improvement.

Each Friday night after work, Bubba would fire up his outdoor grill and cook a venison steak. But all of Bubba's neighbors were Catholic - and since it was Lent, they were forbidden from eating meat on Friday. The delicious aroma from the grilled venison steaks was causing such a problem for the Catholic faithful that they finally talked to their priest.
The Priest came to visit Bubba and suggested that he become a Catholic. After several classes and much study, Bubba attended Mass. As the priest sprinkled holy water over him, he said, "You were born a Baptist, and raised a Baptist, but now you are a Catholic."

Bubba's neighbors were greatly relieved, until Friday night arrived, and the wonderful aroma of grilled venison again filled the neighborhood.
The Priest was called immediately by the neighbors and as he rushed into Bubba's yard clutching a rosary preparing to scold him, he stopped and watched in amazement.
There stood Bubba, clutching a small bottle of holy water which he carefully sprinkled over the grilling meat and chanted: "You wuz born a deer, you wuz raised a deer, but now you is a catfish."

Rob

(For archived commentaries, check www.robchrisman.com, or to subscribe write to rchrisman@robchrisman.com)