MBSLive.net Founder and CEO Matt Graham caused quite a controversy among IMBs with comments he made on CNBC about housing’s role in inflation. NFM TV sat down with him to further discuss what he meant, ask if he regretted his statement, and talk about the current state of the mortgage market.

Full Transcript is Below:

– I’m Greg Sher from NFM TV. Really excited to talk to Matt Graham. He is the founder and CEO of MBSLive.net. And Matt has been talked about a lot more recently than he’s probably used to due to his spot on The Exchange on CNBC last Friday with Kelly Evans. Created a little bit of controversy and we’re going to hear why Matt was asked about the spread between the 30 and the 10 year and should the Fed intervene. Here is what he had to say.

– My audience specifically isn’t gonna like to hear what I have to say about this but nothing’s going to be done at any official level to try to ease the pain of rates. The housing market has been central to the inflation problem that we have.

– Matt, it’s great to have you with us on NFM TV. Really appreciate it. Some people took that comment out of context to make it sound like you were saying it was the housing industry that caused the gross inflation that we’re still fighting today. I understand that’s not what you meant. You don’t have an unlimited amount of time, especially when you’re on that kind of stage. Here, we’ve got a little bit more time. So reflect back on that comment that you made and what you meant.

– Yeah, thanks. So it is always a trip to be on live TV, especially when you get questions that you weren’t necessarily expecting. And I probably shouldn’t have prefaced that with saying that my audience wasn’t going to like what I had to say because that sort of predisposes people to take it poorly. But the main goal there was to say, first off, let’s address housing’s role in inflation. It’s multifaceted and it’s not as if some exuberance in the housing market is exclusively responsible for inflation. It would’ve been better to have addressed things that I’ve addressed for the past few years to my audience, which is that the fiscal side of the equation and the supply chain stuff were the primary two drivers of hyperinflation.

– Well, you caught the attention of David Stevens. He’s a very well-known name, the former president of the Mortgage Bankers Association, also the head of the FHFA, the FHA commissioner under Barack Obama. And I’m wondering if you got a chuckle out of the comment he made on a LinkedIn post where he said, “I disagree with the dude from Mortgage News Daily, which is you, that’s in addition to all the great work you do at MBSLive.net. You’re also gainfully employed at Mortgage News Daily where you do a myriad of functions there. What was it like to get called out like that and called a dude? Did you chuckle or did you grimace?

– I didn’t care so much. Some of my audience members thought it was a little bit disrespectful, but that kind of stuff doesn’t bother me. I was more, I guess, dismayed that it was taken out of context and that he thought I was talking about him because I didn’t know that he had made this suggestion for Fannie and Freddie to buy MBS and the question from Kelly Evans was not one that I was expecting or that I had thought much about. And my focus is on the bond market and on rates and all the stuff with the conservatorship, Fannie and Freddie, what they can and can’t do, the PSPAs and all that stuff. That’s not an area of expertise for me. And so I don’t know if it’s feasible or if it even makes much sense. So I just immediately translated that question in my mind to is any help coming for the mortgage market from an official level? And my gut reaction to that is no from an official level. I just think about it in terms of the Fed mainly and the fact that the Fed has really cooled off on wanting to help the housing market. And several recent Fed comments have even said, you know, “The housing market’s doing fine. We don’t need to do anything there.”

– Is it doing fine in your opinion?

– It depends on how you wanna define it. Of course not in terms of volume and in terms of affordability for people that are coming into the market right now. I mean, it’s definitely not doing fine. Are home sales, especially new home sales, not so much existing home sales, are new home sales doing better than we might expect given the headwinds that we’ve placed in front of them? Arguably some would say that’s the case.

– Six weeks ago I asked Mike Fratantoni the chief economist of the NBA, what percentage chance, I know you don’t love this game, I’m just gonna ask you anyway, what percentage chance in 2024 that interest rates will be at 5.5% or lower? And Mike’s answer was 75%.

– Whether it’s 60, 75, I don’t know for sure. You know, my margin of error’s a little bit wider than that but there’s definitely a scenario where that happens.

– Matt, finally, before I let you go, MBSLive.net, when people go there, what will they find?

– MBS Live is the service that I created that I would’ve wanted for myself back when I was an originator. And it has real-time MBS and treasuries, real-time discussion with thousands of loan officers around the country, commentary that I write and alerts that we put out, customized alerts, a mobile app, marketing platform. It’s just a happy place. Well, unless your happiness is exclusively tied to how rates are doing in the past few years. Other than that, it’s a happy place for mortgage originators to come together, learn about financial markets and to have a discourse about operational concerns and macroeconomic considerations for the mortgage market.

– Excellent. Well, I encourage people to go there. Really appreciate your time. Matt Graham, founder and CEO of MBSLive.net.

– Can I add something really quick?

– Please.

– I just wanted to say that, you know, in the era of social media where we know there are are pitfalls, it’s refreshing to see someone like you who can have a collegial dialogue with somebody like me in the situation we found ourselves in where things in other arenas could potentially get heated. You extended the olive branch and said, “Hey, let’s just talk about this.” And I really respect that and appreciate the opportunity to come on and talk about it. So credit to you for that and thanks for doing what you’re doing.

– All right. I appreciate it very much. Fair and balanced. That’s what we all aim to hopefully deliver that at the very least. Matt, thanks so much. We’ll talk to you again in the future.

– Thanks. Have a good one.

– I’m Greg Sher from NFM TV. We will see you again next time.