Nom de Plumber is a Nom de Plume.
Start here: Fed Flummoxed by Mortgage Yield Gap Refusing to Shrink: Economy
An idea if the New York Fed wants to save four points on its QE purchases AND lower the primary mortgage rate:
Open up a direct retail lending office at 33 Liberty Street. (A good way to recycle the existing Maiden Lane SPV’s.)
Yes, that would kill off the embedded IO’s in the huge SOMA portfolio………just a small technicality.
Stated differently, if the Fed wants to see what is keeping a wide primary-secondary spread, it could see who has been aggressively buying TBA’s way ABOVE PAR.
Look in a mirror.