I am very gratified that so many of you take the time and interest to leave comments on this blog. One of the things about blogging is that it can sometimes feel like you’ve set up a little platform in the park and are speaking through a megaphone, but no one is listening. So please keep it up!
Comments are useful to me, not just because readers point me to confirming or conflicting information sources, but also because they tells me as a writer how you reacted to the piece. Sometimes I am too sharp; sometimes I go overboard on detail; sometimes I skip over an important bit of logic, assuming it is understood. It is also very helpful to me that you chat among yourselves; it takes some of the pressure off me to keep coming up with new content.
And I do see all your comments; I get an e-mail each time a comment is posted.
I try whenever possible to respond to comments that seem to call for one, but with the growing number of comments, that isn’t always possible. And some are outside my immediate knowledge and would take research. There are a couple of comments in particular I regret not having answered, and one of them I can’t locate (Blogger searches only my text, not comments). One was from an Australian lawyer which (although worded differently) in effect asked about restrictions on modifying mortgage terms. I have addressed that issue in other comments but if you see this and want to e-mail me your query again, I’d be happy to respond.
Another question was, “Were the MBS which the Fed accepted as collateral last week agency MBS or private and, given the Fed requirement that an instrument’s acceptance is contingent upon federal guarantee, might this latter have been created through use of agency CDS?”
I think you can find the answer here: http://www.frbdiscountwindow.org/discountmargins.pdf. Note that the Fed also says in multiple places, “call your local branch with questions.”
Finally, in a mea culpa, I put up an animal interest story yesterday that showed some pictures of a tiger with piglets. The photos were darling:
However, it turns out the cute story I had been sent about the pix was apocryphal, as an alert reader quickly informed me. Although the tigress was alleged to be from California, and the piggies wearing tiger stripes were supposedly introduced to help her get over the loss of her own litter, Snopes.com says the scene is from the Sriracha Tiger Zoo in Thailand, which has the most successful tiger breeding program, but also stages what Snopes calls “carnival-like shows” including mixing different species in the same enclosure. Turns out the momma tiger in the photos was herself nursed by a sow.
Well, I am no tiger expert, but she still looks pretty happy with the arrangement to me. But lesson learned. Guess even my fluffy fare has to come from recognized outlets.
Regarding the MBS as collateral for the discount window loans accepted by the Fed.
One aspect of the transaction escapes me, and I have not seen any reference to it yet – By accepting the MBS as collateral, hasn’t the Fed in fact affixed a price to these assets ? If not, would not this be the most incompetent banking ever ? By negotiating these loans, it seems to me that the Fed is attempting to place a floor under the MBS market. What do you think ?
Know that your commentary is VERY much appreciated. I read most of the financial blogs, and this is one of the best. I rank you right up there with Calculated Risk. High praise indeed. I am seeing more links to your site on other blogs. Just hope that the trolls don’t find you.
Thank you for sharing your views. I look forward to reading them every day.