That seem insane. Are 50% of homeowners going to default on their mortgage? Even if they do, are the homes worth nothing in a foreclosure sale?
I think the market has gone into Anal-Cranial loopback
RockOn's question of 100% or 95% seems much more reasonable.
I think the market has gone into Anal-Cranial loopback
RockOn's question of 100% or 95% seems much more reasonable.
According to a commentator in the Econbrowser post, the non-agency AAA mortgage backed securities are worth 50 to 70 % on the dollar. That's a severe haircut that we wouldn't know if the Fed is applying.