But that reticence could be slipping. As the week opened, the yield on the benchmark 10-year Treasury was at 1.94 percent, the highest it has been in several weeks.
Another manager noted that, “It’s been very intense recruiting in the markets that have shown the most growth: Texas, California, Florida and the DC [Washington] area.”
Some factions of the industry have expressed a concern about the “liquidity language” in the FHFA proposal, but that’s not a concern for Pingora's Lau.
Michael Stegman, a counselor to the Treasury on housing finance policy, said the exercise aims to solve the “chicken-and-egg” issue that some see as holding back non-agency MBS activity.