Mortgage Backed Securities are minus 28bps this morning.

Chairman Bernanke stated in his semi-annual testimony that the Fed is ready to step in and try untested measures to stimulate the economy if it falters. That signaled to investors that another round of quantitative easing maybe in the cards. Just two weeks after the Fed stopped QE2 there is more talk of easing. This has investors cheering and running for the exits in the bond markets and rushing into equities.

...

Mortgage Backed Securities are Minus 40bps this morning and puts the 3 day total above 100bps.

The Chicago PMI came in at 61.1 rising from the 56.6 reading last month and well above the 51 that analysts expected. Last month the same reading slipped and gave investors pause that the stimulus was not working. This reading tells investors that we were in a soft patch and the long term health of the economy may be just fine.

"The Greek parliament bore a gift to the...

Mortgage Backed Securities are minus 16bps this morning and are down 47bps since yesterday afternoon.

Equity markets rallied yesterday afternoon and contiune the rally here again today. Last week we had investors pile into the bond markets like clowns into a small car at the circus. That took the 10 year Treasury yield to the 2.83. We are now at 3.08 on a 10 year Treasury. Most of that movement happening in the last 48 hours. This as Greece pushed to get austerity measures pushed...

Mortgage Backed Securities are Minus 22bps this morning.

The results of yesterday's auction were fair at best, This started a slide in MBS yesterday afternoon. The slide continues today as equity markets are rising over optimism in Greece. Olli Rehn, the European Union’s commissioner for economic and monetary affairs, in a statement Tuesday said

The austerity and privatization measures “must be approved if the next tranche of financial assistance is to be released,”...