Reading Time: < 1 minute March 16: Bear Stearns, $29 billon Sept. 6: Fannie/Freddie, $200 billion Lehman Brothers: sorry baby no bail AIG: $85 billion Who is the next??? Essentially Fed/Treasury are transfering the downside risks from individual companies to the fed/treasury/greenbacks. Note the money pledged to support Fannie/Freddie/AIG could exceed the original number if the problem worsens. I can
Reading Time: < 1 minute Fannie/Freddie Short term I think it’s a deal for fed. But long term (it seems nobody is caring about long term these days), why should China continue to buy the Fannie/Freddie debt, for some premium over the US treasuries with substantial mortgage market risk (liquidity). I agree the US treasuries and Fannie/Freddie debt are co-related.
Reading Time: 2 minutes (Update, according to WSJ) The deal in summary: the US treasury dept. will put up to 200 billion ($100 billion each) to support the mortgages loss from Fannie and Freddie; the treasury will buy $1 billlon of preferred shares for 10% divivend, the preferred are senior to all other preferred previously issued (I believe all
Reading Time: < 1 minute Fannnie and Freddie crisis I read Burham’s beat Fannie Mae’s Golden Goose article last Friday, after seeing the dramatic stock actions of FNM and FRE on that day. Following that, I also reviewed Barrons March 11 article, IS this Fannie Mae Toast? Yeah, it looks like it. The bad thing is, those executives at Fannie