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Oh! No,Not Another Bail Out!
Those damn derivatives are hell when they call your poker hand! It's all bailouts until there is none then it's bail in's come on line and they drag the whole house of cards down at the Casino of the central banks.
serf
At 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.
This is a collapse of the system,” Habib said. “It’s as simple as the Fed stops buying for a period of time.”But together with the storm that gripped financial markets from the coronavirus, they also effectively blew up a widespread hedge that mortgage bankers use to protect themselves against rate increases. The hedge pays them if the prevailing rate in the market is higher than the mortgage rate they locked in with the customer.