Goldman picks up $6B in mortgage bonds

Goldman Sachs has put in the winning bid for roughly $6 billion worth of U.S. home loan bonds without government backing and is now making an offering to investors, sources told Bloomberg News. The firm beat out Morgan Stanley for the debt, which was being sold by State Street Corp. Since July, $75 billion in mortgage bonds without government guarantees have been offered in open auctions, of which $11.5 billion has failed to sell. According to David Castillo of San Francisco’s Further Lane Securities, the Goldman offering “would be a massive trade, an attention-getter… there’s liquidity in the market and a tremendous amount of cash that’s looking to be put to work, though going into year end, everybody wants to buy cheaply.” [Bloomberg]