Today brings the release of no economic data so mortgage backed securities will have nothing to react to except the
stock market and headlines.
After yesterdays huge rally in our and the world's stock markets, today the Dow is currently down 16 points after
being up almost 300. Seems volatility remains and will continue to drive the action. Our mortgage backed
securities opened the day slightly higher but has since turned into the red(bad).
Today Sec. Paulson, Ben Bernanke and Chairman Bair each gave a statement on the government rescue plan. The main
reason for the speech was to assure investors that everything is okay and please start investing again. Sec.
Paulson also announced a shift in the Treasury department. Instead of the Treasury buying illiquid debt from banks,
they will instead buy equity in banks.
Hard to say what direction rates will move today. The spread between treasuries and mbs have tighten but not
because mbs are improving but rather treasuries are selling off.
We will post back if we see a move in one direction but it appears mbs' have found a trading range of about 7 ticks.
For a more detailed update and comments regarding the speeches from this morning, click the link at the top of this page.