Good Morning on this fantastic Tuesday,

Stocks are on fire. Earnings season has begun and for the most part, companies are beating estimates. Stocks love that and the Dow is up 450 on the day. The surprising and encouraging part of that right now is bonds are holding their own. The 10-yr is still at 3.16% and mortgage bonds are flattish (0-+5) bps on the day.  It gets kind of dicey here, as bonds should not be as strong in the wake of a surge in stocks. Clearly the first part of this is money that has been on the sidelines however, if stocks continue to run, at some point, I would anticipate it taking a bite out of bonds. So for now, I am watching where stocks close.

Here a bit of a sobering commentary.. Millions of American household budgets are so stretched that homeowners would tap into their home equity just to meet everyday expenses. Among those who earn less than $30K a year, 31% say it’s OK to do that, more than triple those who earn $75K+ according to a new survey from Bankrate.com. The idea that nearly 1 in 6 American homeowners views ‘keeping up with regular household bills’ as an appropriate reason to borrow from home equity speaks to how far some households are stretched on a monthly basis,” said Bankrate.com chief financial analyst Greg McBride, CFA.

Make today great!