Mortgages finally got their day in the sun on Wednesday - and not on anything that Federal Reserve Chairman Ben Bernanke said in his semiannual address to Congress. The day, in fact, was off to a rough start following weaker-than-expected earnings news from Fannie Mae, which added to the risk of a further shrinkage in its portfolio.

But then the Office of Federal Housing Enterprise Oversight (OFHEO) announced that it would lift the GSEs' portfolio caps on March 1 as both agencies published their 2007 financial statements in a timely manner (see p. 17). Both agencies must still maintain a capital level that is 30% above the statutory minimum, although the OFHEO anticipates a gradual decrease as the GSEs complete the terms of their consent orders.

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