The extreme volatility experienced last week in the equity markets didn't quite cause that big of a stir in the bond markets, but nevertheless they were affected. The bigger news, though, was another announcement regarding the GSE regulatory reform bill, known as HR 3703.

"First we saw things rally, then we saw things fall off," said Gary Singleterry, president of New Jersey-based Singleterry & Co. "It seems like the bond market is an inverse mirror image of the NASDAQ. Mortgage spreads widened out quite a bit last week and we've seen them widen out a little bit this week."

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