Ep. 153: Mustafa Chowdhury on Mortgage Risks, Fed Shocks and Derivatives

Mustafa is a rates guru and member of the research team at Macro Hive. Before this, Mustafa was the Head of Rates, FX, and Derivatives at Voya Investments, where he helped manage $40 billion of assets. Prior to that, he was a Managing Director and Head of US Rates and MBS Strategy at Deutsche Bank. And in the 1990s, he was Co-head of Asset-Liability Management at Freddie Mac, where he was responsible for managing one of the world’s largest fixed income derivatives portfolios and trading desks. In this podcast we discuss: 

• How financial institutions manage mortgages on their books 
• How options are used to manage market risk 
• What triggered sub-prime/global financial crisis 
• Why households and mortgage markets are safer today than in 2008 
• How the Fed has nationalized the mortgage market 
• Will Fed quantitative tightening (QT) impact markets? 
• View on US interest rates? 
• Can the US curve invert more? 
• Why the Fed will end up breaking something 
• View on equities and credit 
• Size of Fed balance sheet losses 
• Thoughts on Bank of Japan 
• Books recommended by Mustafa: A Random Walk Down Wall Street (Malkiel), A Monetary and Fiscal History of the United States (Blinder), Surveillance State (Chin, Lin) 

You can follow Mustafa here 

Read the full transcript here.

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(The commentary contained in the above article does not constitute an offer or a solicitation, or a recommendation to implement or liquidate an investment or to carry out any other transaction. It should not be used as a basis for any investment decision or other decision. Any investment decision should be based on appropriate professional advice specific to your needs.)