The Mortgage Bankers Association warned that the housing market could face a " large-scale disruption," due to actions by the Fed that were meant to help the mortgage market.
Federal Reserve Chair Jerome Powell holds a news conference following the Federal Open Market Committee meeting in Washington, December 11, 2019.The Mortgage Bankers Association in a dire letter to regulators Sunday warned that the U.S. housing market is "in danger of large-scale disruption," due to efforts by theAt issue are the Fed's unprecedented $183 billion of purchases last week of mortgage-backed securities. The purchases were meant to drive down rates, and they did.
Hardest hit are independent mortgage bankers who wrote about 55% of the $2.1 trillion mortgages created last year. In the week of March 16, the Fed bought $68 billion of mortgages. But the market still saw massive selling, prompting the Fed to come in with an additional $183 billion of purchases last week. The combined quarter-trillion-dollar in mortgage purchases by the Fed over two weeks was $84 billion more than the Fed had bought over any four-week period during the financial crisis in 2009.
But Barry Habib, founder of MBS Highway, a leading industry advisor who was among the first to publicly sound the alarm bell last week, said the Fed needs to go further than just modulate.
afaduln2 Saving bankers again. Why can’t bankers go to jail or go bankrupt? Why do continuously put bankers above the working Americans? Trickle down has been a failure for 50 years..
They love the leverage! Why didn’t they complain when they were making so much money? If they believe the MBS in this portfolio are of high quality, shouldn’t they use their own personal money to scoop up these undervalued assets?
coinyeezy I guess they never watched the movie, Margin call.🤦🏽
I am kinda sick of reading stories about borrowers that borrowed too much and now want a bail out. Build a model that assumes the world will not always be perfect and Invest assuming that the worst can happen. I hope and pray that we learn from this, but I doubt it!
Let them default....
moorehn humble request for a plain language explainer on what’s happening 👩🏻🏫
Need to be more clear about what these hedges are.. if they are rate caps why would lower rates hurt?
There are greedy people everywhere. Only question one should ask- will a policy uphold the free and fair markets in the long run? If it’s not then the policy is not a good thing.
FED is literally killing everyone except major wall st banks and few mega hedgefunds. They’re screwing everyone to save their face.
Leverage sucks when it goes the other way.
You corporations are supposed to plan for this sort of thing, and manage risk. In capitalism, government shouldn't bail you out.
Unintended consequences!
WallStreetYoda good read here.
Have we in reality experienced another financial crisis, much larger in potential impact than 2008 and this one is proving harder to tame?
Fed intervention to fix prior fed intervention to fix prior intervention
FNMA_RRR Put them all in conservatorship like they did2Fannie&Freddie and then nationalized them by taking all their profits4eternity like it’s✅2 twins.Reminder both Corp had enough of$in08 but gov took them over2save Goldman’s of the🌎! POTUS stevenmnuchin1 larry_kudlow FHFA
Shouldn’t the loans they are hedging have a gain in them they will realize when the sell them...
I'm in the market for a house, so I wouldn't mind seeing the housing market get slapped down.
Cure worse than the disease? Fed doesn't care, just throw 💰💰💰at it.
“Ironically, the MBA had urged the Fed to come in strongly to help the mortgage market.”
🤣🤣 lies!
Fed needs to buy everything - say debt laden real Estate companies
This applies now more than ever that we have infinite FED money, REPO implosion, and government buying commercial debt(soon equities)......Why the whole banking system is a scam - Godfrey Bloom MEP via YouTube
greedy bastards always want more and they'll tank the entire economy to get it
He's Trumpy !
toughest job in the nation at this moment.