It’s a love-hate relationship if ever there was one. Publicly Washington will continue to bash Wall Street into 2011. “Wall Street” now being the loosest of terms to reflect any firm involved in mortgage finance. But that will matter little to Rep. Darrell Issa (R-Calif.), incoming chairman of the House Oversight and Government Reform Committee, which is expected to lead the charge to investigate the role of Fannie Mae and Freddie Mac in the foreclosure crises. At least that will be what the public needs to see. Considering Freddie Mac alone employs 2,000 mortgage servicers and pays them $5 billion a year, it will be interesting to see how in-depth the investigation can afford to be. (Fannie has 1,400.) Indeed, the investigation will likely be largely ceremonial, as the administration seems more intent on not harming the fragile secondary markets. Further, macroeconomic reports are starting to finally brighten. Minutes being released Tuesday from the Federal Open Market Committee will likely show the “Fear of a double dip in the U.S. economy vanished with 3.3% economic growth expected in 2011. No rate increases expected in H1 11,” according to credit analysts at Société Générale. And global investor sentiment is also easing up in the commercial space. Giles Keating, head of Global Research at Credit Suisse said, in a search for yield, domestic commercial real estate is back on the international radar. “Some of the yields still look very attractive, for example, some of the U.S. West Coast’s commercial real estate yields, and to a lesser extent the East Coast,” he said in a yearly outlook report right before Christmas. “The yields that you get on good quality commercial real estates are standing well above the government bond yield, which is a favorable indicator.” Washington is almost certainly aware of this and is looking to regain momentum lost from its recent second round of quantitative easing. “That theme has been percolating among bearish portfolio managers since November, and will take several months to flush it from the system as QE2 has been widely branded a failure,” said Jim Vogel of FTN Financial in a note this morning to clients. At this point, some market players are even suggesting that the government may end QE2 prematurely, if the FOMC minutes hint at disagreement over quantitative easing, Vogel adds. Though personally, this seems unlikely, as it may read as an admission of failure. Such an admission runs counter to the financial Ying Yang the Obama White House is trying to convey in fixing its marriage to Wall Street. And in the spirit of balance, the president is now rumored to center the upcoming Issa investigations with the potential appointment of Bill Daley as White House Chief of Staff. “We think this move, if it happens, would be seen by investors as very bullish,” said securities broker/dealer Keefe, Bruyette & Woods in an e-mail this morning. Daley is currently working at JPMorgan and previously served as secretary of commerce during the Clinton administration, points out the securities broker/dealer. JPMorgan received bailout funds, after all, and Daley is being vaulted into the White House. What does that tell you? “This provides an early signal that the administration’s rhetoric against large banks and Wall Street may start to be toned down, a positive in our view for banks,” KBW, an investment bank itself, notes. It is a positive turn, if a largely symbolic one. For this embrace, let’s be clear, is one of those man-hugs where the arms go around the body, yet the men still tap each other on the back. It’s Washington’s way of saying to Wall Street: “I’m hugging you, but I’m also hitting you.” Jacob Gaffney is the editor of HousingWire. Follow him on Twitter @JacobGaffney. Write to him.