Markets Rallying On QE And PSI

Looks like straight QE may be off the table, but the Fed is working on other ways to pump money into longer dated bonds and mortgages. For now market is positive. This is weak compared to real QE though purchases of mortgages would be more interesting as tries to more directly to help the housing market. It will definitely help banks make money on their mortgage inventory, but how much would filter into the real economy remains a question. And just a few days ago, market thought it was getting real QE.

Stories PSI will be over 75%. Not surprising at all. Anything less than 100% leaves some really interesting questions to be answered by Greece. It won’t be 100%.