Comment on the following statement by a representative of an investment management firm who is working with a client in selecting sectors in which the manager for the account will be permitted to invest:

Mortgage-backed securities give our managers the opportunity to increase yield because these securities offer a higher yield than comparable Treasury securities. In particular, our managers prefer Ginnie Mae mortgage-backed securities because they have no credit risk since they are backed by the full faith and credit of the U.S. government. Therefore, our managers can pick up additional yield with no additional credit risk. While Ginnie Mae mortgage-backed securities may not be as liquid as U.S. Treasury securities, the yield spread is more than adequate to compensate for the lesser liquidity.