[csomar]

I have no idea what's going on but here is my take: The mortgage lenders all thought that the rates are going to go through the roofs. So they used money that they should not use to bet on that. They did not just hedge their position, they over-hedged so that they can make free money when the rates explode.

The fed intervened by lowering rates and now their positions are liquidating. Apparently, this is not only gambling money and they might have over-leveraged themselves with other money they legally/morally should not use.

Now they are calling for the FED to intervene and help them with their mistakes. We'll see how this is going to unfold.