If you’ve been waiting for a rate bottom, this could be your week.

Fasten seatbelts: U.S. rate volatility will spike this week.

Today’s Originations links on the fourth quarter stock outlook, loan limit battle in Washington, and fallout from EU’s big decision. -Loan Limit Battle Looms In GOP House (WSJ Developments) -LATEST: Will Loan Limits Increase Again? (TheBasisPoint) -Why Greek CDS Market Is OK (FelixSalmon) -Fatal Flaw In Europe’s Rescue Plan (TheAtlantic) -Stocks Could Rally a Bit [...]

Edward Harrison of CreditWritedowns was all over the EU announcement today, and ended the day with a post about how the “voluntary” 50% writedown on Greek debt by banks skirts a default. Which means that investors who bought credit default swaps (CDS)—insurance where investors get paid in the event of a default—don’t get paid. Net [...]

At the end of last week a leading Wall Street researcher wrote, “The general tone at ABS East was somewhat gloomy, however most participants view the non-agency sector relatively attractive versus other sectors. The market has seen a recent drop in PrimeX prices, and it is important to understand the collateral underlying in the Prime [...]

The mortgage industry melted down August 2007, then whole financial world melted down September 2008. The Subprime Primer, a hilarious powerpoint chronicle of the crisis, made the rounds back then. I just stumbled across it, and I’ll repeat what I said at the time: Of all the deep analysis of the subprime crisis, this is [...]

This is a good one…

When I was writing my 2011 rate outlook last month, I asked some former colleagues—CFA types much smarter than me—for their views on what a possible municipal bond implosion might mean for mortgage backed securities (MBS). I asked because consumer mortgage rates are tied to MBS, and I was testing a theory on whether MBS [...]

In all of the post-bubble analysis of what went wrong lots of blame is placed on credit default swaps (CDS), which are fairly new, having not existed before 1994. Inauspiciously enough, CDS stemmed from a disaster. On March 24, 1989 the Exxon Valdez, an oil tanker headed to Long Beach, CA hit a reef in [...]

Fed’s Conflicting Recovery Agenda The Federal Reserve Bank of New York has joined forces with BlackRock, PIMCO and other major bond investors in trying to force Bank of America to repurchase $47b of mortgages that were packaged into securities. Bank of America defended its position. “We’re not responsible for the poor performance of loans as [...]