In addition to lowering its policy rate at the beginning of the pandemic, the Federal Reserve engaged in Quantitative Easing, meant to lower longer-term interest rates and stabilize the mortgage market. Now that the Fed is aiming to remove accommodation from the economy, it is quietly shrinking the amount of Treasury securities and MBS on its balance sheet while markets focus on the path of the fed funds rate. In this episode, FHN Financial’s Walt Schmidt talks about how to understand MBS as the Fed continues its Quantitative Tightening and nears the end of its tightening cycle.