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by nemo44x 1202 days ago
We will see what happens this weekend but if Ackman is right then we’ll see bank after bank go to 0 in the coming weeks and months.

50% of mortgages were written (new + refinanced) between 2020 and 2022. These are all in bonds paying 3% or less. Who is holding these?

If deposits were used to buy these then so many banks are done for. Those depositors want their money back so they can get 4%+ interest now. Everyone is going to start to pull.

Contagion is here.
1 comments
blindriver 1202 days ago
> These are all in bonds paying 3% or less. Who is holding these?

Fannie Mae and Freddie Mac. Most mortgage originators packaged up the mortgages and sold them immediately to the government.

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Kon-Peki 1202 days ago
Yep, my 2021 mortgage was sold before the first payment.
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bequanna 1202 days ago
They didn’t “sell them to the government”.

However, the Fed was actually a large purchaser of MBS if that is what you’re referring to.

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blindriver 1202 days ago
Okay it's technically not a part of the government, but it's a Government Sponsored Entity with public ownership. All mortgages bought by them have an implied guarantee by the US government.

So they did sell them to "a government-sponsored entity and the US government has an implied guarantee to pay any defaults."

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