Ever since the 30 year auction closed earlier, the market has been acting about as rationally as the Stalingrad Bourse back in 1939. Nowhere can this be seen better than the volatility in the 15 Year mortgage. Vol has moved from stocks, to CDS, to treasuries and is now roosting in mortgages. Rinse. Repeat?
An even more vivid representation is the spread between the 30 year mortgage and the 10 year UST. Holding our breath for the SEC to release the 8-K saying this is normal and expected market gyrations.
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