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To: patron_anejo_por_favor who wrote (118447)	8/27/2001 6:27:14 PM
From: Box-By-The-Riviera™	Read Replies (1) \| Respond to of 436258

=DJ Mortgage REITs, Thrifts -2:Sell-Off Seems Indiscriminate 27 Aug 15:46 By Janet Morrissey Of DOW JONES NEWSWIRES NEW YORK (Dow Jones)--Mortgage real estate investment trusts and thrifts fell Monday as nervous investors appeared to sell off financial industry stocks over interest rate and credit risk fears. Many of the thrifts, such as Washington Mutual (WM) and Golden West Financial (GDW), began tumbling Friday. Mortgage REITs appeared to get caught up in the sell-off as it spilled into Monday's trading. Washington Mutual was off 5% after falling 7.4% Friday, while Golden West slipped another 1% Monday after plummeting 10.4% Friday. A number of mortgage REITs, such as Annaly Mortgage Management Inc. (NLY), Thornburg Mortgage Inc. (TMA) and Redwood Trust Inc. (RWT), were off on heavy volume Monday. Jolson Merchant Partners analyst Jim Fowler said the sell-off was fueled by investor concerns that the Federal Reserve Board is done cutting interest rates, and that credit risk is on the rise. If the Fed has indeed ended its run of interest rate cuts, market watchers speculate the rock-and-roll heydays for the financial sector may soon be over. If rates start ticking up, borrowing costs rise and mortgage origination activity may slow or dry up. This could pressure a company's net interest margins, which measures the difference between the costing of borrowing money and the yield the company gets on its loans and other assets. Then there's the credit issue. Credit card, mortgage, and home equity debt has been climbing in recent years, said Fowler. If corporations continue to cut jobs, unemployment could rise, which potentially increases the chances of consumers defaulting on some of that credit. Still, Fowler said investors appear to be selling off financial stocks across the board, regardless of whether they face significant exposure to these issues. The credit issue, for example, will likely affect mortgage companiesthat originate subprime loans most, not those that focus on high-credit quality and Fannie Mae (FNM) and Freddie Mac (FRE) loans, he said. Larry Goldstone, president and chief operating officer of Thornburg Mortgage, speculates that his company's stock movement Monday was triggered by the sell-off in the sector. "We have no news from the company," he said, "and our outlook and prospects for 2001 and 2002 have not changed." -By Janet Morrissey, Dow Jones Newswires; 201-938-2118 (END) DOW JONES NEWS 08-27-01 03:46 PM