Banks ricochet as Fed details planned mortgage purchases – MarketWatch
by Tom on December 31, 2008
in Market Musings, banks
The Federal Reserve late Tuesday released details on its plan to buy mortgage-backed securities guaranteed by the federal agencies that support the secondary market for home loans. It will start buying mortgage-backed securities in late January, it said. Previously the Fed said it would buy up to $500 billion in mortgage-backed securities.
Banks ricochet as Fed details planned mortgage purchases – MarketWatch.
Okay, I don’t really get what the big deal is here. Let me explain how I see it:
- The Fed said, “We’re going to buy Mortgage Backed Securities.” The market (and many writers) wrote lots and lots about it (if you want to read some of my thoughts, let me know and I’ll send you the information.
- Now the Fed comes out with some details and essentially says, “Yes, we really are going to do what we said!” And the market is all in a “tizzy” (that’s a technical term.)
So what’s the big deal. They said they are going to do it, now they say, here’s how we’re going to do it. To me, it doesn’t seem like it’s a big deal (or even close to a big deal) until we get to the Jerry MacGuire point and can say, “Show me the money!”
I’ll have more as I’ve got time, but I’m off enjoying the California weather and time with the family. A full blogging schedule will resume next week.
Have a Happy New Year!
