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Strategies & Market Trends : John Pitera's Market Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: Hawkmoon who wrote (9914)	9/6/2008 11:59:53 PM
From: John Pitera	1 Recommendation Read Replies (1) \| Respond to of 33421

Hawk, they are simply fascinating stocks. I honestly can not figure out exactly the risks they face. However, it seems as if RDN is going to survive and prosper. I really think you are on to a good thing with RDN. One thing I can say about it's daily chart this past year is it's got constructive bottoming action the past several months. I would really need to be a pretty savvy corp attorney in the sector in which they toil to really understand mechanics and concomitant responsibilities that RDN has. I'm not. Radian Group Inc. jumped 21 percent to $4.96, the highest since June. The third-largest mortgage insurer said it expects to maintain its relationship with Fannie Mae and Freddie Mac, the companies that buy the loans it insures. Radian is also boosting its sales force ``significantly'' as lenders seek to lower risk and make their loans more attractive to investors, said the company's Chief Executive Officer S.A. Ibrahim. MGIC Investment Corp., the largest U.S. mortgage insurer, added 14 percent to $9.80 for the biggest gain in the S&P 500.

To: Hawkmoon who wrote (9914)	9/7/2008 8:41:09 AM
From: stomper	1 Recommendation Read Replies (1) \| Respond to of 33421

As John said: I would really need to be a pretty savvy corp attorney in the sector in which they toil to really understand mechanics and concomitant responsibilities. I guess my initial sophmoric thought is as you state...aren't you playing with fire based on the potential liablities for which the MI's are severly underfunded? As prime loans have recently surpassed subprime on % of loans 60 days+ (read, severely delinquent are close to 7% of all outstanding now, i believe) we seem to still be scratching the surface. I would suspect that the issues behind fraudulent lending won't gain nearly as much traction in the higher quality mortgage pools--which will give the underfunded argument another boost--but that is 100% supposition on my part. I've got two acquaintances both of whom are bailing on mortgages they are over $200,000 upside down on. I suspect either make over 150 a year. They have enough cash to walk away from their mortgages and not care what the credit consequences are. They are looking at it purely as a financial planning decision. BTW, I think you are dead on re the legal fights coming. I am in information management and I've never worked so much with legal departments. Wonder if a RDN has the financial chops to hold their own in countless legal battles? Definitely an interesting sector, still too many potential unknowns for me. Big risk, big reward. Broad picture is very hard for me though with so many conflicting data points converging into one issue. Of course, i didn't buy C at $2.00 back in the 80's either.