Change in the benchmark and another turbulent session.

With Monday's huge jump in mortgage backed securities, we're shifting our focus to the FNMA 5.5% bond. Today, we started the day way down, as much as -28bp. By mid morning we were looking at 16bp gain. However, with no real significant (as far as bonds are concerned) economic reports due out it was going to be up to the stock market how we finished the day. News from Lehman that they are in bad shape and are now attempting to sell off a majority of its investment management division and commercial real estate holding in order to raise capital. Buyers saw the opportunity andjumped into the oversold sectors of the market which of course took money out of bonds. So our 5.5% FNMA mbs closed down 16bps on the day to close at $100.84. This should be a short term trend and by the end of the week I fully expect to see us settle where we were on Monday. We have a resistance level just above us and "normal" market actions most likely won't be able to break through. However, we have retail sales reports coming on Monday and I have to assume that those won't produce "good news" and we'll see a flight to the safety of bonds.

For my last team advice post, sew up your "inter team" and make sure they work well with your partners. The importance of those people around you that help you day in and day out cannot be overstated. And you can't "over-appreciate them" either. Plan a nice event with you, your mortgage/cpa/financial planner/etc partners, have everyone split the cost and cook out at someones house, go bowling, whatever it is that they enjoy and treat them to "thank you" night. Not only will it make everyone feel appreciated, but it will provide a social setting that will further the efficiency of your whole operation. If my processor and the setup person from Real Estate office are friends, then they will naturally work better together. Plus, you'll be able to advance your relationships with those that send business to you. It's important to have that level of friendship, it furthers trust and provides incentive to help perpetuate every ones success and business.