FICC Focus Macro Matters: MBS Update With BI’s Erica Adelberg
Feb 5, 2026
Erica Adelberg, Bloomberg Intelligence’s chief MBS strategist, offers sharp takes on mortgage-backed securities and housing policy. She explains the $200B GSE MBS buying mandate and its market impact. She reviews affordability proposals and why lower rates may not help buyers. She also lays out current MBS relative-value ideas like CMOs, hybrid ARMs, and specified pools.
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GSE Purchases Tightened Spreads Quickly
- The GSE MBS purchase program tightened spreads immediately and likely encouraged other accounts to pile in.
- The purchases likely formalized demand rather than solely causing spread moves through direct buying.
GSEs Returning To Retained Portfolios
- Fannie and Freddie have been adding to retained portfolios since mid-2025, reversing years of runoff.
- Combined purchases have been roughly under $15 billion a month in specified pools so far.
Three Government Levers And The Offset Risk
- Government levers for affordability are demand, supply, and income support, and demand-side moves can be offset by price increases.
- A 25bp mortgage-rate drop can be fully offset by a ~3% home-price rise, erasing affordability gains.