Updated Fannie/Freddie Linkfest
I have been updating our weekend linkfest on Fannie and Freddie continually. I keep adding to the Wall Street research section, MSM, and blogs.
Here's the latest in Wall Street research and media coverage;
Wall Street Research:
GSE Rescue Plan: Market and Economic Implications Morgan Stanley
http://www.morganstanley.com/views/gef/index.html#anchor6881
Mark-to-Market Now Mark-to-Taxpayer First Trust
http://www.realclearmarkets.com/articles/mark-to-market_now_mark-to-taxpayer_.pdfWelcome to the U.S.S.R. (United States Socialist Republic) Citigroup (PDF)
The end of America's bad mortgage dream Financial Post
http://www.nationalpost.com/opinion/columnists/story.html?id=27dccda7-61d0-461d-a83e-a3c79530c814Bringing Out the “Bazooka” David A. Rosenberg, Merrill Lynch (PDF)
First thoughts on the market impact of the Treasury's GSE plan, Goldman Sachs (PDF)
Unblocking the arteries, price support and intervention Nomura Securities
(Blocked_Arteries_PArt 1.pdf ) (Part II PDF) (Blocked_arteries Part 3.pdf )The Long and Short of the Fannie Mae and Freddie Mac Rescue Northern Trust (Web PDF)
http://web-xp2a-pws.ntrs.com/content//media/attachment/data/econ_research/0809/document/dd090808.pdfPaulson Begins Gradual Wind-Down of GSEs within Conservatorship, Institutional Risk Analyst
“Somebody’s got some splain’n to do!” Raymond James
http://www.raymondjames.com/inv_strat.htmDeja Vu (Again) John P. Hussman
http://www.hussman.net/wmc/wmc080908.htmHank Punts on First Day of Pro Football Season Cumberland Advisors
http://www.cumber.com/commentary.aspx?file=090808.asp&n=l_mcWelcome To The Mortgage Business Ciovacco Capital Management
http://www.ciovaccocapital.com/sys-tmpl/mortgagenew/
Pershing Square Capital Letter to Treasury Department Regarding Fannie and Freddie
This Crisis Is Not Over John Mauldin, Paul McCulley, Michael E. Lewitt
http://www.investorsinsight.com/blogs/john_mauldins_outside_the_box/archive/2008/09/08/this-crisis-is-not-over.aspx
What the Mainstream Media had to say:
Wednesday, September 10, 2008
Reduced Exit Packages Urged for Ousted Executives NYT
http://www.nytimes.com/2008/09/10/business/10comp.html
Government intervention is losing its market mojo WSJ
http://online.wsj.com/article/SB122100183460716949.htmlFannie, Freddie Takeover Jolts Preferred Market as Prices Fall Bloomberg
http://www.bloomberg.com/apps/news?pid=20601087&sid=a2eUYQafZCU8&Federal Mortgage Success Stories NYT
http://www.nytimes.com/2008/09/10/business/10home.html
Tuesday, September 9, 2008Fannie Mae, Freddie `House of Cards' Prompts Takeover Bloomberg
http://www.bloomberg.com/apps/news?pid=20601087&sid=a3pTtizqxtcA&Fannie, Freddie To Be Removed From S&P 500 WSJ
http://online.wsj.com/article/SB122099815669516745.htmlA Risky High-Wire Act NYT
http://www.nytimes.com/2008/09/09/business/09big.htmlFat Fannie and Freddie L.A. Times
http://www.latimes.com/news/opinion/la-ed-fannie9-2008sep09,0,7271059.storyA desperate but necessary bailout MSN
http://articles.moneycentral.msn.com/Investing/SuperModels/a-desperate-but-necessary-bailout.aspxFANNIE/FREDDIE BAILOUT BALONEY NYPost
http://www.nypost.com/seven/09092008/postopinion/opedcolumnists/fannie_freddie_bailout_baloney_128135.htmU.S. Plan Serves as Template For China to Bolster Its Markets WSJ
http://online.wsj.com/article/SB122089797255310905.htmlAnalysts mixed over bailout's impact on builders MarketWatch
http://tinyurl.com/6fx86uMcCain May Privatize Fannie, Freddie; Obama Sees Federal Role Bloomberg
http://www.bloomberg.com/apps/news?pid=20601087&sid=a1ujoLiLLz78&Freddie's dead Guardian
http://www.guardian.co.uk/commentisfree/2008/sep/08/freddiemacandfanniemae.useconomyA New Fannie and Freddie Washington Post
http://www.washingtonpost.com/wp-dyn/content/article/2008/09/08/AR2008090801908.htmlFannie & Freddie: Buying friends in D.C. CNN/Money
http://money.cnn.com/2008/09/08/news/companies/fan_fred_buying/?postversion=2008090908Fannie, Freddie need restructuring to limit risks: IMF Reuters
http://www.reuters.com/article/ousiv/idUSLAG00304420080909Rescue Risks Setting Stage For New Woes WSJ
http://online.wsj.com/article/SB122091498820212291.htmlFannie, Freddie Takeover Ends Lobbying Effort Bigger Than GE's Bloomberg
http://www.bloomberg.com/apps/news?pid=20601087&sid=aA6fdeTelSDQ&Reinventing Two Mortgage Giants: A Big Rebuild or a Teardown? NYT
http://www.nytimes.com/2008/09/09/business/09future.htmlMortgage Bailout Is Greeted With Relief, Fresh Questions WSJ
http://online.wsj.com/article/SB122088294934209997.htmlSen. Dodd Questions Fannie-Freddie Takeover NPR
http://www.npr.org/templates/story/story.php?storyId=94407478Rescue of Mortgage Giants Displays Paulson’s Clout NYT
http://www.nytimes.com/2008/09/09/business/09bush.htmlBailout Hits U.S. Agenda WSJ
http://online.wsj.com/article/SB122092489265913267.html
The full linkfest continues here.
Tuesday, September 09, 2008 | 04:30 PM | Permalink
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Comments
Barry and others, I hate to go ot but do you think that this Friday, we'll have announcements on WaMu and Lehman's?
Posted by: JL | Sep 9, 2008 4:35:53 PM
That rally had a half-life shorter than Sodium-24.
.
Posted by: VJ | Sep 9, 2008 4:42:54 PM
Barry is on vacation leave so the blog will be only automatic postings I assume.
LEH down 50%. Now which banks hold that stock because now they have another huge loss.
A depression is in the works. I'm surprised at how many were fooled by inflated oil prices. The only reason the oil went up so much is that market people assumed because the fed was lowering rates that inflation would kick up. Over the short term they were right, over the long term dead wrong.
Posted by: John Borchers | Sep 9, 2008 4:43:58 PM
Each bank is going to bury the other:
"PNC Financial Services Group Inc. (PNC) said Tuesday that it expects to record a "significant" other-than-temporary impairment charge in the third-quarter from its perpetual preferred stock investments in Fannie Mae (FNM) and Freddie Mac (FRE). "
Posted by: John Borchers | Sep 9, 2008 4:46:18 PM
John, I fear that you are right. But remember that Sarah Palin is a breath of fresh air.
Posted by: JL | Sep 9, 2008 4:48:08 PM
New Century, IndyMac, Countrywide, American Home, Fannie, Freddie, Bear Stearns...
Lehman and Wamu...
the FDIC...
Eventually the entire quasi-private financial system will be gone.
No worries for the dollar, though. We've still got nukes.
Posted by: Donkei | Sep 9, 2008 4:50:57 PM
"The Maestro" himself was just on CNBC discussing the merits of this bailout...the funny thing is, I simply could care less what he has to say. It is of absolutely no importance any longer.
Thanks Barry for keeping us informed with intelligence and spin-free candor.
Posted by: PHB | Sep 9, 2008 5:01:21 PM
The rally ended at about 10AM...it lasted EXACTLY 7 hours...where did I hear that before...oh...I posted that Sunday night.
Troubled financials will take this opportunity to try and slip news by without getting hurt too much due to general stupidity of the market. For example WaMu looks like they just fired their CEO and Lehman doing a shake-up, but nobody cares with Dow futtures up 260. Rally lasts 7 hours of US trading or less.
Posted by: Steve Barry | Sep 7, 2008 10:49:11 PM
Posted by: Steve Barry | Sep 9, 2008 5:08:27 PM
Market only seems to react to news that someone is stepping in to fund another's failing enterprise. If a guy has a drug problem, is it really a positive if he finds a new source of drugs?
Posted by: Doug | Sep 9, 2008 5:16:30 PM
Sales force dot com to replace Freddie on the S&P500? OMG. They have got to be kidding.
Posted by: John Borchers | Sep 9, 2008 5:21:57 PM
As many others and I forecast it didn't have any legs but neither do I see a deluge around the corner. We're just going to see a lot of volatility for the next year while the US economy slips into a major slowdown that is going to last a awhile. Lehman is clearly in deep doo doo and todays drop indicates some people know something. The good bank/bad bank scenario was bs, the bad bank would have needed all kinds of guarantees and a tranche of cash to fly. Most likely outcome; a Treasury managed, what don't they manage these days, restructuring in which the business is essentially liquidated. The good stuff will be sold to KKR or Abu Dhabi and the bad stuff fire saled at 20 cents on the dollar or less to vulture funds. I don't think Lehman will be with us by thanksgiving.
Posted by: John(2) | Sep 9, 2008 5:24:34 PM
Steve,
nice!~
Doug,
It's part of the script, it helps to reinforce the, mistaken, belief that "Government" has, much like OZ, "special powers".
Ya Know, We've been Really Stupid--this G**bage was predicted for us, 100's of Years Ago, by our Founding Fathers.
But, hey, Foolish Founders, what did they know, Right?
Posted by: Mark E Hoffer | Sep 9, 2008 5:25:01 PM
Barry:
Regarding the thieves at seeking alpha (SA), were I you, I would send an email to every blog you can find that provides a link to the SA site. I would calmly explain to them your beef with SA, and how each of them could easily be the next SA victim.
Then, and this is the "kill" part, I would ask each of them to remove the link on their site to SA, and explain how doing so is in their long term interest.
If no other sites link SA, their traffic will be impacted.
Posted by: anon | Sep 9, 2008 5:27:43 PM
need suggestions for safe place to invest in a deflationary environment besides under a mattress. what was up is down. what was down is down further. Bonds, gold, CDs at 3.6%, where???
Posted by: newby | Sep 9, 2008 5:30:08 PM
need suggestions for safe place to invest in a deflationary environment besides under a mattress. what was up is down. what was down is down further. Bonds, gold, CDs at 3.6%, where???
Posted by: newby | Sep 9, 2008 5:30:24 PM
The big shift is coming as no one wants to invest in the banks anymore. The cash injection game is over and those injections all became quick loses.
I see 3 poor banks that invested in FMN or FRE preferred which are now losses.
Without interest to make investments in these it will only get worse, and much worse.
Ponder this, is an SUV really worth $30k?
What other things around us have extremely inflated prices compared to the historical average of asset vs. asset?
Posted by: John Borchers | Sep 9, 2008 5:33:44 PM
Newby, if you have any debt of any kind. That's where to invest right now.
Posted by: John Borchers | Sep 9, 2008 5:35:45 PM
And you think that people both inside and outside the usa have much more confidence in the good ole usa than they do in Lehman or the GSE bailout? Well, big shot, what would you advise us to do if you are so smart, that might get a modicum of trust back in our national leaders in this financial crisis??
Glad you asked.
No one is going to raise taxes in this downturn.....so.
1. Cut the fat from next year's national budget.
2. Cut the muscle from next year's national budget.
3. Circle the bone of next year's national budget. Gnaw off the gristle..
National debt increased 250% in one year.
Completely unacceptable...
4. You also increase the excise tax on oil to raise the price per gallon to, say, 3.85 so that our nascient alternative programs don't die in the incubator..if they do, we simply wash, rinse, and repeat the oil crisis in two years.
5. Same old saw, but finally we realize it is time, just like we give women the vote and tell politicians they can't be president most of their adult lives...
We pass a balanced budget amendment. Period.
Hold the applause...I'm going out to eat with my bride.
Bruce in Tennessee
Posted by: Bruce | Sep 9, 2008 5:52:07 PM
Thanks for all these links - you provide a great source for information :)
Posted by: Matt Nolan | Sep 9, 2008 6:01:47 PM
newby,
invest in yourself :)
however, if you invest in CD's, make sure to spread them around various banks/CU's
and below FDIC insurance limits.
From my Schwab account, I have numerous selections available 24/7.
I also look at local credit unions/banks
online or in the newspaper to compare rates.
of course this assumes the FDIC stays solvent...
Futhermore,
you can go to The Street.com and or Banrkrate.com
they both have a bank rating system(s) on their web sites.
Individual Bonds seem too dangerous
(risk w/ low return) to me!
Steve Berry,
GREAT CALL!!!!!
Posted by: MarkTX | Sep 9, 2008 6:02:17 PM
Correction
Steve Berry should read Steve Barry.
Posted by: MarkTX | Sep 9, 2008 6:03:33 PM
Bruce in Tennessee,
what ever happened to the
The Gramm-Rudman-Hollings Balanced Budget and Emergency Deficit Control Act of 1985
Former Senator Phil Gramm is still laughing his aaaarse off all the way to the bank-
that bank being UBS of course.
Eat good, and I will hold the golf clap until tommorrow...
Posted by: MarkTX | Sep 9, 2008 6:13:05 PM
Ponder this, is an SUV really worth $30k?
What other things around us have extremely inflated prices compared to the historical average of asset vs. asset?
Posted by: John Borchers | Sep 9, 2008 5:33:44 PM
This, to me, starts on the right track.
The sooner we start imagining this Economy in x(.6) fashion, the better off we will be.
The excesses go way beyond the FIRE-sector and the, ever-present, Waste, Fraud $ Abuse of Gov't, we have entire Industry Verticles, see Industrial Gases, for starters, that are completely artificial.
Also, to reiterate, T. Boone is right about using CNG for vehicular fueling. Our 'addiction to Oil' is contrived, along with our dependence on Foreign Sources.
We need to wake-up and start doing our own Homework, We've seen, enough, of the Answers, others have for us.
Posted by: Mark E Hoffer | Sep 9, 2008 6:28:13 PM
Speaking of deflating assets...
"....Denver Nuggets guard Allen Iverson has been looking to sell his 14,000 square foot home in Villanova, Pennsylvania for over a year now.
According to the Wall Street Journal's Private Properties column, Iverson has dropped the price to a "desperation deal" of $3.999 million — a million less than he paid for it in 2003."
Posted by: Winston Munn | Sep 9, 2008 6:52:20 PM
Barry,
Not sure if PBS qualifies as MSM but thank goodness it exists. Calculated Risk today has a link to a one hour Charlie Rose program with El-Erian, Roubini, Gretchen Morgensohn and Floyd Norris. It's quite accessible and a good way of conveying some of the crisis to people without a professional or trading interest in economics.
All this stuff will be great book material when this is all over. I know you are itching to write the definitive work on The Maestro's Dark Legacy...
Posted by: leftback | Sep 9, 2008 7:22:52 PM
