The Smackdown Continues
July 9th 2008 23:31
A down market, more than a complete opposite of Tuesday, slipped over 236 points to a new closing low for 2008 and lower than anything in 2007. Looks like we're zeroing in on the 2006 low of 10,683.32. (See Chart)
Two of the biggest losers were troubled companies Fannie Mae (FNM) and Freddie Mac(FRE). FNM closed down $2.31 or over 13% (see chart) and FRE closed down $3.20 well iover 23% (see chart)!
Mike Shedlock reports:
The word "nationalize" in conjunction with FNM and FRE is becoming more wide spread.
Jesse writes
Both FNM and FRE have an implied U.S. government guarantee making them AAA, but derivative traders are pricing the debt much lower.
Two of the biggest losers were troubled companies Fannie Mae (FNM) and Freddie Mac(FRE). FNM closed down $2.31 or over 13% (see chart) and FRE closed down $3.20 well iover 23% (see chart)!
Mike Shedlock reports:
Capital concerns are still affecting Fannie Mae (FNM) and Freddie Mac (FRE) in spite of assertions from James Lockhart, director of the Office of Federal Housing Enterprise, that the GSEs are "well capitalized".
The word "nationalize" in conjunction with FNM and FRE is becoming more wide spread.
Jesse writes
Credit-default swaps tied to $1.45 trillion of debt sold by the two biggest U.S. mortgage finance companies are trading at levels that imply the bonds should be rated A2 by Moody's Investors Service...
Both FNM and FRE have an implied U.S. government guarantee making them AAA, but derivative traders are pricing the debt much lower.
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