Though the signing of a $50 billion emergency supplemental appropriations bill for Ginnie Mae by Congress and President Clinton late last week may serve to allay some concerns about the liquidity of the government agency's products, several MBS players said the agency may not be out of the woods just yet.

"Ginnie Maes have just not caught a bid this week," said Art Frank, an MBS researcher at Nomura Securities. "They're trading cheap almost beyond belief, and one of the contributing reasons is that the real active trading accounts think that the liquidity is surely better in Fannie [Mae securities]. There is just a general lack of sponsorship for Ginnies at this time."

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