A better open this morning in the bond and mortgage markets;the stock indexes pointing to a lower open. Two days of stock market rallies generally leads to a day of decline as investors are still unwilling to jump in heavily. On the bond and mortgage markets, the rate markets are likely to continue their sideway movement until at least Friday when the August employment report is released. The MBS market continues to be volatile with price changes as much as 7/32 a click at times; this morning 30 yr MBSs traded +11/32 (.34 bp), in one trade the price fell 7/32 (.22 bp).

<p>Charles Evans, Chicago Fed President, on CNBC this morningsuggesting the Fed should be doing much more; he mentioned the Fed should increase its inflation target to 3.0% in an effort to reflate prices, he suggests he would like to see more stimulus, he wants the Fed to set a target for low rates possibly tied to employment like until the