Oana's is an interesting and seemingly valid point: "metering." Note that the Fed's policy of paying interest on excess reserves has made it possible. It allowed banks (used loosely: investment and otherwise) not to mark-to-market. That's why they've been able to hold onto so much REO and to engage in allowing short sales, etc., while still remaining liquid and solvent, at least on paper and when their off-balance-sheet liabilities aren't factored in.
Oana: As far as the shadow inventory is concerned, that’s irrelevant. It’s irrelevant for a lot of reasons. Number one, we’ve had the shadow inventory for more years than I can count at this point.
Oana: And it has not shown up. The second reason why that’s irrelevant is because the institutional sellers have that inventory but they have no reason to dump it on the market. They have experience with that, and they’re not going to do it again. They are metering out the inventory, and it is coming on the market at absorption rate or even lower than that, which is the reason why our inventory is so low and it has been low for a long time.