I'm not sure whether you are directly answering my questions and I don't know what you're getting at.
I reckon that because of the highlighted/ bold point of yours, it's little to no chance to have 100% MBS supported by private market. But what about a Sallie Mae scenario where a new entity had been set up from scratch and then transferred all interests and liabilities of the old company to the new one? As far as I know the shareholders got 1:1 for the shares of the new company. And the pps increased like over 10 times in 10 years.
My main point is that for the mechanics of QE to work the FED will need a Very large and VERY liquid MBS market to be in place.
How much longer can QE go on? The Fed's balance sheet is already up to $4 trillion. On the otherhand as long as the US gov runs such high deficits unless the Fed buys that new debt, who else will?