Rumor of progressive developments regarding the debate on Capitol Hill over an automaker rescue package has boosted sentiment in equity markets. The FN 5.5's immediate reaction to the stock market bounce was a 6 tick (6/32) sell off from 100-08 to 100-02. Since that point the benchmark coupon has been bid back up to 100-09 but is having difficulty breaking this technical resistance level (62% retrace). We are now 9/32 off the high of 100-17 for the day. As more news of a bipartisan agreement is presented markets will digest and react accordingly. Due to the current profit taking trading mentality, if developing political news is equity side friendly a liquidation of  "flight to safety" positions may ensue which could pose a threat to MBS pricing in the near term. It has been a volatile day so far so stay tuned....