What We're Hearing

As we all know, the White House (and most Democrats) have punted on the Fannie Mae/Freddie Mac issue until next year. I would assume that once the "What is the Future of the GSEs?" discussion begins in earnest early next year, some Republicans will want to throw the mortgage interest deduction overboard too. Indeed, The Cato Institute's Mark Calabria today on CNBC raised the issue of killing the deduction, arguing that it's really an incentive for Americans to take on more debt. If Democrats go along with the idea of killing the deduction it likely will be in the name of reducing federal deficits. Meanwhile, some stock analysts are getting a bit bearish on Banco Santander, the Spanish bank that controls Sovereign Bancorp of Pennsylvania, one of the largest remaining thrifts. Not only is Sovereign an active residential lender in the Mid-Atlantic States, it has an active warehouse lending division. We're not sure how active the group is because Santander's executives seem to have a policy of not talking to the press at all about what Sovereign is up to...