So I didn’t get much time to catch up on markets after I sent out yesterday's commentary. I was bombarded by clients who wanted to dig deeper into this idea that the Fed move to reinvest the proceeds of mbs pay downs was less about a policy shift and more about a...
I arrived back stateside late last night so I am just gathering my thoughts. I certainly did not expect a blatant shift to balance sheet targeting by the FOMC and I am trying to look through to motivations. Yes the data have been poor, but all indications from...
Jim Bullard has actually thrown a great paper out there for all of us to think about (http://research.stlouisfed.org/econ/bullard/pdf/SevenFacesFinalJul28.pdf). The simple premise is that using “extended period” style language creates unintended negative consequences...
Yes I’m making a jocular to reference to Johan van der smut, aka Goldmember - but the real accident here has to do with GC1 chart I have attached. We have broken the 100 day MA and the 200 day is VERY close by. One of the central themes of the Depressionistas (a...
I remember the days when non agency mortgage desks used to hedge their interest rate exposure. Then the crisis hit and instead of thinking about red packs they were busy deciding whether to discount cash flows at 8%, 15% or 25%. It was easy to understand why non...
I remember the days when non agency mortgage desks used to hedge their interest rate exposure. Then the crisis hit and instead of thinking about red packs they were busy deciding whether to discount cash flows at 8%, 15% or 25%. It was easy to understand why non agency guys had no use for interest […]
