US Housing Finance: Our Vision for a Privately Led System

There’s a growing consensus today that the US government’s huge footprint in the $10.5 trillion mortgage market needs to shrink, with the private sector taking the lead. But there is less agreement on how the transition to a new system should take place. Here’s our perspective as investors in the mortgage market on what is needed to get the ball rolling. (more…)


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Private Sector Involvement Is Unlikely in Second Portuguese Bailout

With 10-year Portuguese bond yields above 14% (see Display), the market is suggesting that Portugal will soon need another bailout from its euro-area partners. While we share the market’s skepticism about the sustainability of Portugal’s public sector finances, we doubt that policymakers at this stage will seek to impose losses on private sector creditors, as they did in Greece’s second bailout last year. (more…)


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