Quote:
Originally Posted by buckman
The government won't let it fail. It has trillions of unlimited funding. What company can claim that?
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"Trillions in unlimited funding", where did you get that?
Fannie Mae doesn't get unlimited funding from the US Government. Hell, until recently they didn't get much help from the Government at all. Last year the Government did lift the restriction on the US Treasury purchasing Fannie Mae stock, and allowed them to issue low interest loans...all in the name of keeping the lender afloat. Now we as taxpayers own a lot of stock, but considering that Fannie and Freddie are behind most of the mortgages in the United States, this might be a prudent move. My position is that we should break them apart and sell the parts.
But to briefly analyze Buckman's stock pick. Pretty much the entire financial community saw a lot of buying this week. To single out Fannie Mae leads me to believe this post might be more empty rhetoric than financial substance?
All in all it's a good thing though. That negative p/e is pretty telling...when people will spend a buck for a stock that was pretty much worthless a week ago, for a company with negative earning, might just mean investors are starting to believe the banks are becoming more stable.
-spence
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