The Residential Real Estate Crash Index Message Board

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Strategies & Market Trends : The Residential Real Estate Crash Index

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To: Les H who wrote (15336)	12/6/2003 9:11:55 PM
From: yard_man	Read Replies (2) of 306849

Les or anyone -- please explain -- what is a step-up provision?? would this be a contarian indicator for rates in the near term?? thnx >>Confirming that the GSEs have geared up to hawk debt to the yield-chasing public (with clear implications for the contracting money supply “debate”), comes an article yesterday from Dow Jones’ ace journalist Christine Richard: “As fears of rising interest rates continue to mount, retail investors have been buying step-up bonds issued by government sponsored enterprises, such as Freddie Mac and Fannie Mae… (LaSalle Broker Dealer Services managing director) Kelly estimates Fannie Mae, Freddie Mae and the Federal Home Loan Banks have sold around $25 billion to $30 billion in retail debt this year and about 40% of that debt contains step-up provisions. ‘Demand has picked up recently for step-ups as the result of expectations in the market about the future path of rates’ said Itai Benosh, director of debt product management at Freddie Mac.” <<

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