On mortgage-backed securities specifically, he suggests valuations may still look attractive relative to treasuries because spreads have not compressed the way they have in other parts of credit. He implies that lingering uncertainty around Fannie Mae and Freddie Mac may be one reason for that. Overall, his view is that securitized credit has benefited from floating rate protection, low defaults, improving credit quality, and a market backdrop that has been better than the recession forecasts implied.
