Agency spread update (2)

Agency spreads are narrowing rapidly these days. This adds to the list of things that are bouncing. It's also a reflection of improvement in credit spreads generally. Confidence in counterparty risk is returning. The fixed-income market is functioning better. Liquidity is returning. We have pulled well back from the abyss we were staring into in early March. All very encouraging. Goldman Sach's Abby Joseph Cohen says the S&P 500 index could rise 20% in the next 6-12 months, but at this rate, it might happen sooner.