The Fed has sold almost the entire Mortgage Backed Security market short. Now it is time to drop it.
Remember, the term "buy" to the Federal Reserve means "sell" to everyone else. They "bought up" the MBS market at prices no one else was willing to entertain (= WAAAAAAAAY too high) along with a scarcely noticed taxpayer guaranty of no losses.
That means when they "sell" the junk, we have to pay their loss. That's right, we have to "buy" it. That means they "sold" to us at WAAAAAAAAY too high a price. Out of the kindness of their hearts, they lent us the cash to buy it too, at interest.
Now, it's time to dump the junk. The lower they price it, the faster they get paid in full. And the faster they start accruing interest on our debt to them, as our cumulative national real estate losses get tacked on to the national debt.
Real estate is about to start flying out of inventory. The inept main stream media will think the Fed has dropped a gift from heaven. "RE Sales UP 200% YOY!!" they'll rejoice, ignoring prices that are deteriorating more than hard-line bears dared to dream.
I've dreamed it. It isn't pretty.
