Central Banks and Agencies - John Jansen -  I wrote a lengthy piece yesterday about the diminished bid for agency paper in the Central Bank Community. Brad Setser posed the pertinent question and wanted to know where the money that was not being spent in agencies was being invested. - Across the Curve

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HOW LOW BEFORE HOUSING GOES?  - looks at optimism vs doom and gloom - Stocks and Bonds

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Memo to the President-Elect; How Much Capital Does a Bank Need? - … Once the GSEs are safely under a conservatorship, with a program in place to slowly run-off the retained portfolios as the debt supporting them matures, then we can start focusing on the next task, namely fixing the securitization markets and recapitalizing the commercial banks. As you’ve read in this space previously, banks are GSEs too, just more competitive and focused on providing primary market finance to the private economy as opposed to the secondary, after-market function performed by FNM and FRE.  … - Institutional Risk Analyst

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FT Editorial - No more need for Freddie and Fannie - FT.com 

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German Subprime Victim Goes The American Way - Lionel Laurent - LONDON - IKB was Germany’s first high-profile banking victim of the subprime crisis, but now American private-equity firm Lone Star is snapping it up for a price that is likely to end up below $1.0 billion. … - Forbes 

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From OFHEO - Metropolitan Statistical Areas, Micropolitan Statistical Areas and Rural Counties with New Loan Limits - Fannie Mae and Freddie Mac conforming loan limits for the high cost areas below may rise on a temporary basis to the corresponding levels listed. These temporary jumbo conforming loan limits apply to loans originated from July 1, 2007 to December 31, 2008. - 7 page list at OFHEO 

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What I Told Neil Cavuto This Week  - Why I’m bullish on the financials  - Thomas Brown - bankstocks.com 

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Freddie Mac execs sounding out private equity: report - key sentence: The report said the search for investors is challenged by fears that any investment in Freddie or its main rival, Fannie Mae, will be lost if the U.S. Treasury bails out the companies through a purchase of equity in them. - Reuters 

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Korea Signals Confidence in Fannie, Freddie Bonds  - key sentence: The comments may help ease concern about an exodus in Asian demand for the firms’ debt, after buyers from the region pared back their participation at bond auctions the past two weeks. - Bloomberg

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Subprime Delinquencies Surge in July - PAUL JACKSON - An early look at subprime RMBS performance in July, courtesy of Clayton Fixed Income Services, Inc., suggests that a recent lull in subprime delinquencies may be coming to an end. The, percentage of subprime borrowers 60 or more days in arrears at the end of last month surged for both the 2006 and 2007 vintages up nearly 7 and 11 percent compared to June, respectively.  - housingwire

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The Final Fate of Fannie and Freddie - … But the pain goes deeper. Preferred shares of the government-sponsored enterprises (GSEs) have lost roughly 80% of their value, as Wall Street ponders their fate. Even their subordinated debt, which historically traded at a similar yield to the GSE’s senior debt, now trades at historically wide spreads of three to four percentage points above the senior debt. … -   BusinessWeek 

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Fannie, Freddie debt rallies on likely bailout - Lynn Adler - Reuters - Washington Post 

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Rolfe Winker  has a review of the movie of the movie I.O.U.S.A.  at his blog site -   thanks Rolfe 
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The Mortgage Story You Haven’t Heard  - Peter G. Miller - FHALoanPros.com has obtained the letter below. It’s a response by Peter Federico, Freddie Mac’s senior vice president of asset and liability management, … has a copy of letter … - thanks Peter Miller - FHA Mortgage Guide