The FRBNY's Bill Dudley notes a widening spread between primary and secondary mortgage rates. In...

The FRBNY's Bill Dudley notes a widening spread between primary and secondary mortgage rates. In English, lower mortgage rates as a result of the Fed's MBS purchases are not being fed through to consumers. Who could have guessed that ever happening? It's no shock to mREITs, many of whom have noted origination capacity - decimated during the financial crisis - isn't coming back overnight. For those still in the origination business, it means fat profits.

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Comments (5)
  • youngman442002
    , contributor
    Comments (5123) | Send Message
    The people in Congress get the good deals..not you and me...
    3 Dec 2012, 10:09 AM Reply Like
  • rambler1
    , contributor
    Comments (998) | Send Message
    The banks aren't stupid who wants to own 30 year mortgages yielding 3 1/2% when rates go up and they have to pay more on deposits they would get crushed. The Fed's are the ones being the dummies again.
    3 Dec 2012, 10:33 AM Reply Like
  • Tom Guttenberger
    , contributor
    Comments (714) | Send Message
    The expectation of price fixing all the way down to the consumer level seems somewhat idiotic --who does he expect to carry the risk on the pass through arrangements? Anyway, the spread pocketed by originators should eventually manifest into looser lending standards once banks have capital buffers to take some of those risks. The Fed is saying, "we are scratching your back, now scratch ours...right now."
    3 Dec 2012, 11:09 AM Reply Like
  • levin70
    , contributor
    Comments (1057) | Send Message
    Who would have thunk it? Increased rent seeking by banks, unheard of i tell you......
    3 Dec 2012, 11:34 AM Reply Like
  • winningtrader
    , contributor
    Comments (2459) | Send Message
    Well, I thought that the FED wanted QE3 to be just a bank subsidy. Why are they shocked now?
    3 Dec 2012, 11:39 AM Reply Like
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