I keep wondering what will happen in 2010. That is when the GSE’s are suppose to start being net sellers instead of buyers. With no insurance, crippled banks and investment houses and burned investers, who is gonna be buying this stuff again? So then the fed doesnt sell, and yet trying to limit its exposure, starts trying to limit incoming loans. Fannie already not accepting AltA as of 2009. No AltA, No subprime, No liar loans, 20% down, full income qualification, low demand for RE bonds.
I really think the GOV is trying to find a way to fix housing in the rust belt without bubbling housing in CA/FL. I dont think they can do it, but that wont keep them from trying.
