Said Bernanke, groovily dancing:
"Our economy needs more enhancing;
And the timing is apt
For the fiscally strapped
Whose mortgages beg refinancing."
Fed Chairman Ben Bernanke hopes that the reserve bank's remake of its 1961 hit "Operation Twist" will cause the mortgage market to shake it up, baby. So named because it coincided with the popular dance craze, the original Operation Twist attempted to lower long-term rates through the Fed's buying long-term Treasury bonds and selling short-term notes. Similarly, the 2011 cover version, announced after a two-day meeting of the Fed Open Market Committee, calls for the sale of $400 billion worth of notes with maturities of 3 years or less, the proceeds of which will be used to buy 10- to 30-year bonds. In addition, maturing mortgage bonds in the Fed's portfolio will be rolled over into new mortgage purchases, in a bid to support the still-ailing home loan market.