MBS markets have been volatile this morning, even in the face of news that is typically positive for bond markets. The good news is even with all the economic news coming out that should be swining rates higher they are still holding low. In economic news Housing Starts cane in higher than expected and building permits have risen substantially. Jobless claims came in slightly below expected. The big news today is that the Philadelphia Fed came in much lower than expectation, it is actually showing a contraction which is not good for the economy. There is a lot of talk today so far about a banking system meltdown in Europe, as we are finding that Greece is not their only issue.