Commentaries

“The U.S. economy is in recession, with limited doubt remaining.”

“... in our view, two key policy errors contributed to the systemic risk seen in September.”

“For Macquarie Allegiance Capital, this development in Fannie and Freddie has led to a strong total return for the first few trading days of September.”

“It's the market rate of interest, not the policy rate that is concerning towards monetary policy officials.”

“...valuations in Agency MBS securities are the most attractive we have seen in many years.”

“While the stocks of Fannie Mae and Freddie Mac tell a story of deteriorating investor confidence, we believe the bonds of the two companies reflect another.”

“The repricing of risk and deleveraging of the capital markets are unwinding badly. What began as a financial event has become one that is now economic, impacting consumers and economic growth.”

“We do not believe the Federal Reserve will begin as aggressive a rate hike campaign as currently priced in by the capital markets.”

“We believe this higher cost of capital for the private sector will force the Fed to continue to maintain an easing bias in Federal Reserve policy until interbank liquidity and private sector lending improves.”

“March was a month of unprecedented government intervention to stave off significant systemic risks including the forced sale of a major Wall Street investment bank.”

“Federal Reserve policy will lead to lower rates. Speculation of bailouts and interventions that would have been unheard of a year ago are now discussed openly.”

“Market participants are hoping that lower mortgage rates will help the housing market and produce a possible refinance wave; we discuss why we believe the market is overestimating this impact.”

“2007 will be remembered as the year we learned all AAA's are not created equal.”

“Allegiance is worried that existing home inventory sales levels will extend to longer than twelve months and the final bottom for the decline in housing prices will reach 15%.”

“...as we have maintained for the last six months, consumer spending is heavily dependent upon jobs and income, and how the employment picture develops will be the major determinant of which economic reality takes place.”

“...the trouble that began in the subprime mortgage market spread throughout the capital markets affecting lenders, borrowers and an ever-growing number of institutions.”

“As measured by many housing statistics, the U.S. housing market continues to show no sign of reaching a bottom.”

“The third quarter provided the strongest fixed income returns seen in the investment grade space since 2006.”