After two record years of mortgage-backed security issuance, the numbers have started to return to Earth. Higher interest rates are mostly to blame, while low Ginnie Mae supply has also contributed to the sharp decrease.

According to The Bond Market Association, MBS issuance for the first quarter of 2000 was $89.5 billion, a 61.7% drop from the $233.8 billion for the first quarter 1999. After seeing total issuance over 1998 and 1999 at over $700 billion and just under $700 billion, respectively, the Association says numbers like that will be hard to beat.

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