Copper, Wages, And Housing: What's Really Happening

Dr. Copper, Diesel Prices, and the Hidden Forces Moving Mortgage Rates The mortgage market continues to face pressure from elevated Treasury yields, inflation concerns, energy-market disruptions, and higher-for-longer interest rates. From Corona, California, KP breaks down the latest economic data and explains why copper prices, diesel costs, wage growth, and global supply chains could offer important clues about the economy and the future direction of mortgage rates. KP begins by discussing the underlying strength of the economy and why it can be difficult to recognize when mortgage professionals are focused on housing market challenges. He also shares updates from PRMG, including preparations for the spring purchase season, AI integration, and the importance of retaining experienced employees while improving business processes. The conversation turns to Dr. Copper, a market indicator often associated with global economic activity. KP examines copper's price gains, the services sector's continued expansion, and rising input costs that could contribute to inflation concerns. He also explores home equity lending, with $78.4 billion in new HELOC and closed-end second mortgage commitments, alongside improving manufactured housing shipments. KP analyzes the latest jobs report, which showed just 29,000 jobs added, downward revisions to previous months, and unemployment rising to 4.2%. He challenges the conventional narrative about wage growth by highlighting weekly earnings growth of 3.6% and examining CPI, core PCE, and trimmed-mean PCE to assess inflation and workers' purchasing power. The episode also examines Los Angeles' mansion tax and its reported consequences for housing construction, construction jobs, and tax revenue. KP discusses how well-intentioned policies can produce unintended results in housing markets. Later, KP dives into the connection between diesel prices, oil supply, refining capacity, and mortgage rates. He explains the importance of the 10-year Treasury yield and the 3-2-1 crack spread, which measures the refining margin associated with turning crude oil into gasoline and distillates. With geopolitical uncertainty affecting energy markets, diesel prices deserve close attention as a potential driver of inflation and broader economic conditions. Finally, KP shares a reminder for mortgage professionals: You may not be able to control interest rates, but you can change your mindset. By shifting your focus and practicing metacognition, you can improve how you respond to uncertainty and prepare for future opportunities. Episode Highlights: 00:00 – Dr. Copper and the hidden strength of the economy 00:27 – KP returns to Corona, California 00:48 – PRMG, AI integration, and business transformation 01:19 – Preparing for the spring purchase season 01:35 – Treasury yields and higher-for-longer rates 02:26 – Copper prices and global economic strength 02:47 – ISM services and inflation concerns 03:11 – The 10-year Treasury yield approaches 5.30% 03:31 – $78.4 billion in home equity lending commitments 03:48 – HELOC growth and home equity agreements 04:13 – Manufactured housing shipments improve 04:35 – The latest jobs report and labor market outlook 04:58 – Unemployment rises to 4.2% 05:21 – Slowing job growth and downward revisions 05:43 – Why weekly earnings tell a different story 06:07 – Weekly wage growth reaches 3.6% 06:40 – CPI, core PCE, and the pace of disinflation 07:01 – The LA mansion tax and unintended consequences 08:20 – Live from the Cotality suite at Cowboys Stadium 09:40 – Treasury yields fall as bond markets improve 10:19 – The Fed outlook and inflation reports 10:37 – Why diesel prices matter for mortgage rates 10:59 – Oil supply and the Strait of Hormuz 11:19 – Understanding the 3-2-1 crack spread 11:44 – Why diesel is critical to the broader economy 12:24 – Anchoring your mindset during a difficult market 12:42 – Changing your mindset when you cannot change rates 13:05 – Metacognition and preparing for what's next KP connects the dots between economic growth, employment, inflation, Treasury yields, energy prices, and housing. This episode highlights why mortgage professionals should look beyond today's challenges, understand the broader economy, and prepare for the next purchase season. Market conditions may be outside your control, but preparation, adaptability, and mindset can help you navigate uncertainty. Follow for more updates: https://linktr.ee/kptalksdollarsandsense #MortgageRates #MortgageMarket #HousingMarket #InterestRates #TreasuryYields #FederalReserve #Inflation #Economy #MortgageLending #HELOC #HomeEquity #ManufacturedHousing #CopperPrices #DieselPrices #OilPrices #CrackSpread #BondMarket #JobsReport #WageGrowth #KPTalksDollarsAndSense