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To: Jim Fleming who wrote (1686)	3/10/2004 11:45:50 AM
From: stan_hughes	Read Replies (1) \| Respond to of 116555

"There may be a potential problem with the size of derivative operations at the GSE's but these are smart guys with the tools and knowledge to handle it" Isn't that what everybody said about John Meriwether?

To: Jim Fleming who wrote (1686)	3/10/2004 12:08:49 PM
From: mishedlo	Read Replies (1) \| Respond to of 116555

There may be a potential problem with the size of derivative operations at the GSE's but these are smart guys with the tools and knowledge to handle it. FNM is losing Billions betting on rising rates. Note too their head derrivatives guy quit yesterday if I am not mistaken M

To: Jim Fleming who wrote (1686)	3/10/2004 12:39:02 PM
From: reaper	Read Replies (2) \| Respond to of 116555

<<The quickest way to destroy the mortgage and financial markets in the USA is to let ignorant, unchecked, political power get involved>> So nice of you to stop by to this little board, Mr. Raines. <g> Care to comment on how it will also wreck the financial dreams of low income, minority Americans? <<There may be a potential problem with the size of derivative operations at the GSE's but these are smart guys with the tools and knowledge to handle it.>> The problem with the size of the derivative operations at the GSE's is that "mark to market" is a joke for their positions, as the GSE's are "the market". What their derivatives are "worth" is nothing but a theoretical construct, as if they ever had to realize any but a small part of that worth they'd find no takers at those prices. This is precisely the point that Buffett was making over the weekend in his shareholders letter, where he pointed out the losses he took on his derivatives positions, vis a vis their "worth", even though he was selling relatively small amounts into an orderly market. As far as ignorant, unchecked political power, you Mr. Raines have more of that than even John Ashcroft could hope to enjoy. Cheers