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Politics : Formerly About Advanced Micro Devices
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To: bentway who wrote (397913)7/11/2008 11:40:34 AM
From: tejek  Read Replies (1) of 1577188
 
Options expert calls Fannie, Freddie shares 'worthless'

As I am finding out, FNM and FRE are in trouble because the mortgage insurers are in trouble. FNM and FRE were thinly capitalized because it was believed that if their loans defaulted, the PMI would cover them. But as we know now, the monoline insurers are undercapitalized meaning that should a good number of FRE and FNM loans default, they [the insurers] would not be able to make FRE and FNM good.

FRE/FNM shares are now worthless because any gov't bailout would make sure the holders of the common will not benefit. Ugh! Its an ugly mess with the DOW making a new, 52 week low.

Nonetheless, my oil stocks are green!
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