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Unusual Whales Pod #10: The Housing Crisis, Markets, and Real Estate

Unusual Whales

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The Spread Between Jumbo and Conforming Mortgages

The spread between mortgage rates and 10-year U.S. treasuries is close to what we had a really big spread in Q4 of 2018, you know, the last time that the Fed tried to normalize interest rates. By far, the most negative contributor to financial conditions and the current Fed readings here is this Jumbo to conforming spread. So something really screwy is going on with agency paper and the securitization of conforming mortgages.

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