While the Treasury Department continues to find new uses for its massive $700 billion expense account to revive U.S. financial markets, industry experts are hopeful that the government will eventually restore a long-needed shot of liquidity into the MBS market. With an unusually sparse legislative history and an emergency response mentality among its managers, the Troubled...
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Moving Fannie Mae and Freddie Mac into the protective custody of government conservatorship was supposed to stabilize the two bulwarks of the secondary mortgage market and allow them to pump additional liquidity into the market by expanding their portfolio capacity. It hasn’t worked out that way, at least during the first three weeks of conservatorship... [Includes one chart]
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The covered bond market in the U.S. somehow has to build momentum by ramping up production and stimulating investor interest at a time when its major competition in the residential mortgage funding market – government-sponsored credit – has become the only game in town. The best thing going for the fledgling covered bond market...
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The MBS and ABS markets want the Treasury Department to use a new troubled asset guarantee program to improve liquidity for existing mortgage securities, but some banking groups say the program should emphasize whole loans stuck on lenders’ balance sheets. The Emergency Economic Stabilization Act of 2008 gave Treasury authority to launch a new guarantee program for...
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More investors are gearing up to obtain relief and damages for massive losses they suffered during the worst financial crisis in the nation’s history. Institutional investors in Michigan filed a class-action lawsuit against Citigroup Mortgage for allegedly misleading and deceiving them about the quality of MBS they purchased shortly before the deals went sour. The class action...
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Global warming may not be good for the planet, but it could provide a new asset for securitization in the U.S. if policy-makers here follow Europe in creating an energy finance market. Experts at last week’s ABS East conference sponsored by Information Management Network said an active carbon securitization market like the one that exists in Europe isn’t going to grow on...
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A former chairman of the Federal Deposit Insurance Corp. accused fair-value or mark-to-market accounting of being “senselessly destructive” to bank capital and called for its immediate withdrawal and elimination. William Isaac, chairman of The Secura Group and FDIC chairman from 1978 to 1985, strongly condemned fair-value accounting as a major cause of the current financial...
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