The bank mentioned on the article Sovereign bancorp has $8b in stockholder equity so they can take a $600m hit if the pf became worthless. another $35b in losses to the markets if the PF became worthless, considering the system took $500b so far, that doesnt seem to be big enough to demand a bailout. unless a few regionals would go under
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Fnm Fre
- Thread starter Daal
- Start date
Daal - thanks for the post with the Bloomberg article link.
Here is a portfolio of the companies mentioned in the Bloomberg and Marketwatch articles:
http://finance.yahoo.com/q?s=MTB,SOV,FTBK,MBHI,CATY&d=s
It looks like MBHI may be the most exposed, with $67 million holding (source - Bloomberg) versus a $128 million market cap.
http://www.marketwatch.com/News/Story/Story.aspx?guid={A80BA738-16A4-4A2F-9287-AF3756D337FA}&siteid=yhoof2
http://www.bloomberg.com/apps/news?pid=20601087&sid=aM7PbcXSYeIU&refer=home
Here is a portfolio of the companies mentioned in the Bloomberg and Marketwatch articles:
http://finance.yahoo.com/q?s=MTB,SOV,FTBK,MBHI,CATY&d=s
It looks like MBHI may be the most exposed, with $67 million holding (source - Bloomberg) versus a $128 million market cap.
http://www.marketwatch.com/News/Story/Story.aspx?guid={A80BA738-16A4-4A2F-9287-AF3756D337FA}&siteid=yhoof2
http://www.bloomberg.com/apps/news?pid=20601087&sid=aM7PbcXSYeIU&refer=home
Looks like your patience in waiting for a bounce has played out well - including premarket gains FNM has bounced about 45% and FRE about 50%
Quote from Daal:
but if you wait for that massive rally then you take the risk out of the equation(assuming you are right on the value of the stock)
Buffett says Fannie, Freddie are toast:
http://www.bloomberg.com/apps/news?pid=20601087&sid=aooA6DOXavYw&refer=home
http://www.bloomberg.com/apps/news?pid=20601087&sid=aooA6DOXavYw&refer=home
Market seems to disagree with the Oracle, based on pre-market trading.Quote from Cutten:
Buffett says Fannie, Freddie are toast:
http://www.bloomberg.com/apps/news?pid=20601087&sid=aooA6DOXavYw&refer=home
http://www.nytimes.com/2008/08/23/business/23fannie.html
Snippet:
Anxiously awaiting a move by the Treasury Department and spurned by large investment firms, Freddie Mac and Fannie Mae find themselves unable to raise capital and with little ability to maneuver.
Treasury officials have reviewed multiple plans for intervention, according to people who have spoken to top Treasury officials. But they have not identified a set of triggers that will compel a government bailout. Nor have they indicated to Freddie Mac or Fannie Mae executives when a bailout may occur or what form it may take.
As a result, investors are telling Freddie Mac and Fannie Mae that they remain unwilling to purchase new shares in the firms.
âWeâre in a Catch 22,â said an executive with one of the mortgage firms who was not authorized to speak to the media. âAs long as there is uncertainty over Treasuryâs plan, we canât raise money, and as long as we canât raise money, thereâs going to be more and more speculation about Treasuryâs plan.â
In recent days, Freddie Mac has met with potential investors at the law offices of Davis, Polk & Wardwell. But the company has been told by several private equity giants â the Texas Pacific Group, Kohlberg Kravis Roberts & Company, the Carlyle Group and the Blackstone Group â that those investors are unwilling to purchase any type of new stock in the company until it is clear what steps the Treasury Department may take to assist the ailing firm.
âYou would have to be insane to invest in these companies right now, and weâve basically told them that,â said an investment professional with one firm that was approached by Freddie Mac, but who is not authorized to speak to the media. âWhen Treasury comes in, they are guaranteed to get a better deal than us, which would push down the value of our investment. So why would we ever invest before we know what Treasury is going to do?
Snippet:
Anxiously awaiting a move by the Treasury Department and spurned by large investment firms, Freddie Mac and Fannie Mae find themselves unable to raise capital and with little ability to maneuver.
Treasury officials have reviewed multiple plans for intervention, according to people who have spoken to top Treasury officials. But they have not identified a set of triggers that will compel a government bailout. Nor have they indicated to Freddie Mac or Fannie Mae executives when a bailout may occur or what form it may take.
As a result, investors are telling Freddie Mac and Fannie Mae that they remain unwilling to purchase new shares in the firms.
âWeâre in a Catch 22,â said an executive with one of the mortgage firms who was not authorized to speak to the media. âAs long as there is uncertainty over Treasuryâs plan, we canât raise money, and as long as we canât raise money, thereâs going to be more and more speculation about Treasuryâs plan.â
In recent days, Freddie Mac has met with potential investors at the law offices of Davis, Polk & Wardwell. But the company has been told by several private equity giants â the Texas Pacific Group, Kohlberg Kravis Roberts & Company, the Carlyle Group and the Blackstone Group â that those investors are unwilling to purchase any type of new stock in the company until it is clear what steps the Treasury Department may take to assist the ailing firm.
âYou would have to be insane to invest in these companies right now, and weâve basically told them that,â said an investment professional with one firm that was approached by Freddie Mac, but who is not authorized to speak to the media. âWhen Treasury comes in, they are guaranteed to get a better deal than us, which would push down the value of our investment. So why would we ever invest before we know what Treasury is going to do?