While not quite the same as the agonies of 2007 and 2008, 2010 was another calamitous year for the mortgage and MBS markets. Here are my expectations on a variety of topics for 2011.

Agency MBS: I expect pressure on spreads to widen for at least the first half of the year. The various Fed programs to stimulate the economy are negative for mortgages, and there is also the possibility of significant headline risk resulting from GSE reform efforts, which are (in theory) supposed to be picked up early in 2011.

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