What a wonder a little good news on risk will do for the market. News is out that the Fed is finally lending an open ear to AIG after previously saying "you're on your own!"

MBS are up 1 tick at 101-13 despite the dow being up over 90 points now. Treasuries ahve dialed back a bit from their near record territory. The 2 steps forward for MBS and 2 steps back for UST's have manifested in dramatic tightening. It's about time too! Did the world so quickly forget Hank and Jimmy's explicit mission statement to increase foregin investor appetite for MBS? (you bet they did when Merril, Lehman, and AIG were all in jeopardy on the same Sunday afternoon).

Tick by tick, second by second, MBS are holding steady here. Remember, we've had a TON of widening recently, so MBS can afford to gain even if the Dow is doing the same. Just about every coin under every cushion in every couch has recently been placed in good old-fashioned UST's.

If you hearken back to heady days of yore where we sailed boldy into the "eye of the storm" on many a fed day, take ye up that old ore once again. We are naught but 3 hours away from the policy announcement. Expect drama, but as always, should it seem that our vessel will be claimed by the depths of Benny B's Locker, we will be able to, now as it has been in the past, get you out of the boat before you go down with it.

(all that drama largely moot as most lenders are hedged a bit going into today anyway. Just thought it had been too long since a verbose analogy... Don't touch that dial.)