F.H.A. Faces $4.6 Billion in Losses

"Unexpected losses".......LOL!

"President Bush and leading Democrats in Congress are counting on the F.H.A., which is overseen by the Department of Housing and Urban Development, to help istressed borrowers refinance into stable, government-backed loans."

Got gold.....?

Yves from Naked Capitalsim has much more on this topic FHA Repudiates Housing Rescue Bill including this desperate comment to fend off the latest rescue packages from the FHA chief Brian Montgomery ( also hat tip to Housing Wire) .

Yves von Naked Capitalsim hat mehr deprimierende Details zu diesem verzweifelten Versuch der Politik das Unvermeindliche zu verhindern FHA Repudiates Housing Rescue Bill . Hier ein an Deutlichkeit nicht zu überbietender Hilfeschrei von FHA Boss Brian Montgomery ( Dank auch an Housing Wire) das die von der Politik geplanten Rettungsaktionen für den US Immobilienmarkt unweigerlich in ein Desaster führen werden ..... Unnötig zu erwähnen das letztendlich der Steuerzahler für diesen erneuten Irrsinn geradezustehen hat...... Unnötig ebenfalls zu betonen das sich die Politiker gerade in Wahlkampfzeiten am Ende sicher durchsetzen werden....

"Some of the proposed Congressional actions could actually weaken FHA and endanger the housing market by turning FHA into a less stable, less solvent, more bureaucratic entity.

There are some who want FHA to pick up all the potentially delinquent 2 million subprime loans.This is a worrisome idea.

FHA is designed to help stabilize the economy, operating within manageable, low-risk loans.It is not designed to become the federal lender of last resort, a mega-agency to subsidize bad loans."

He should have been so vocal a litlle bit earlier ( enjoy the rant from Mish )

Hier noch ein netter Rumumschlag von Mish

F.H.A. Faces $4.6 Billion in Losses NYT
WASHINGTON — The Federal Housing Administration expects to lose $4.6 billion because of unexpectedly high default rates on home loans, officials said Monday.

Brian D. Montgomery, the F.H.A. commissioner, attributed the unanticipated losses primarily to the agency’s seller-financed down payment mortgage program, which has suffered from high delinquency and foreclosure rates in recent years.

Housing officials said the agency was also hurt by poor performance in its traditional mortgage portfolio. Deteriorating economic conditions led some of its core clients — first-time buyers, minorities and lower-income owners — to default, they said.

The projected loss is the highest in the home loan program since 2004, and officials said the F.H.A. had to withdraw $4.6 billion from its $21 billion capital reserve fund in May to cover the costs. They said the agency, which is self-sustaining, would not need appropriations from Congress to remain solvent.

But Mr. Montgomery warned that the F.H.A. would have to renew its efforts to end the seller-financed down payment program, which accounted for 35 percent of its loans in 2007.

He said the mortgages had foreclosure rates three times those of traditional loans and would push the F.H.A. to the brink of insolvency.

“Let me repeat: F.H.A. is solvent,” Mr. Montgomery said on Monday in a speech at the National Press Club. “However, no insurance company can sustain that amount of additional costs year after year and still survive. Unless we take action to mitigate these losses, F.H.A. will soon either have to shut down or rely on appropriations to operate.”

F.H.A.’s projected loss, more than four times the shortfall attributed to the home program last year, raised concerns about the agency’s ability to lead the national effort to rescue homeowners facing foreclosure.

President Bush and leading Democrats in Congress are counting on the F.H.A., which is overseen by the Department of Housing and Urban Development, to help distressed borrowers refinance into stable, government-backed loans.

Officials say the agency will help 500,000 people refinance by the end of the year, but a vast majority of those have made their payments on time.

Howard Glaser, a mortgage industry consultant who served as HUD general counsel in the Clinton administration, sees the anticipated loss as a concern. “Congress is relying on F.H.A. to help stabilize the mortgage market, but it’s not clear that F.H.A. is as strong as it could be,” he said.

Mr. Montgomery said the agency planned to reopen the comment period on a proposed rule to the Federal Register that would ban the program. But the F.H.A. has tried to eliminate seller-financed down payment loans for years, and it remains unclear whether it will be successful now.

Under the program, a home seller arranges to cover the buyer’s down payment, using financial help from a nonprofit company, but typically adds that sum or more to the price of the house. The deal has been particularly attractive to financially struggling buyers and to owners in depressed markets, according to Congressional officials.

Critics say the practice puts overpriced houses in the hands of poor and minority homeowners who ultimately cannot cover the mortgage. In recent years, the Government Accountability Office and the Internal Revenue Service have both raised concerns about the program.

But with the subprime market collapsed and mortgage companies tightening lending criteria, seller down payment loans have become increasingly appealing both to sellers in slumping housing markets and to lower-income homebuyers unable to get conventional mortgages.

The program, which accounted for less than 2 percent of F.H.A.-insured loans in 2000, now accounts for more than a third of the agency’s portfolio. Housing officials said that 60 percent of F.H.A.’s anticipated loss was directly attributable to the seller-financed down payment program.

Supporters of the loans, who include some powerful members of Congress, counter that the program provides much-needed assistance to low-income and minority families who would otherwise be unable to buy homes.

Representative Barney Frank, the Massachusetts Democrat who is chairman of the House Financial Services Committee, remains opposed to any F.H.A. rule that would eliminate the program, a spokesman said on Monday. Mr. Frank has said he would like to reform the program without killing it.

Freddie aka Fraudie Mac / Market Sentiment

It´s always the reaction to the news that is important....And sending the stock higher almost 10 percent on the following news is a clear sign that the complacency has taken over again....A look at the VIX is confirming this view. On top of this Doug Kasshas observed this: "Investors Intelligence bulls are back up to 46, as bears drop to 29.9 -- at respective highs and lows since January". I think this headline via FT Alphaville sums it up nicely Not as bad as feared’ is the new code for ‘buy, buy, buy’ Here are More Reasuring Facts On Phony Mae aka Fannie Mae

Eine der wichtigsten Regeln für Anleger und Trader ist jeweils zu beachten wie der Markt auf bestimmte Nachrichten reagiert. Und wenn man nach den folgenden Neuigkeiten die Aktie fast 10 % nach oben katapultiert ist das für mich ein klares Zeichen das wir uns einem Level nähern der doch langsam wieder bedenklich wird.....Der sich rapide beruhigende VIX unterstreicht diesen Trend. Doug Kass hat diese Statistik die wunderbar zum Gesamtbild passt. "Investors Intelligence bulls are back up to 46, as bears drop to 29.9 -- at respective highs and lows since January" . Diese Schlagzeile via FT Alphaville fasst es ziemlich gut zusammen Not as bad as feared’ is the new code for ‘buy, buy, buy’ Hier gibt es mehr More Reasuring Facts On Phony Mae aka Fannie Mae

Parsing Freddie's Profit Report WSJ
Freddie Mac's earnings report more clearly than ever defined the battle lines between the company's shareholders and the government, which sees it as one of its main tools to bolster the housing market.

The report the mortgage giant issued Wednesday shows that the company's cushion for losses fell sharply in the quarter, giving it one of the weakest balance sheets in the financial sector and leaving it more vulnerable to future hits from the housing crunch.

This weakening in Freddie Mac's financial footing will unnerve politicians keen to see Freddie buy and guarantee even more mortgages to alleviate the credit crunch.

And investors sniffing around Freddie's shares may also want to pay heed to the enervated balance sheet. That is because the company likely will have to sell a large amount of new stock, diluting existing shareholders, to strengthen its balance sheet.

Freddie said Wednesday that it planned to sell $5.5 billion of common and preferred stock. "I think they'll continue to raise capital," said Paul Miller, an analyst at FBR Capital Markets.

The company's weakened state was lost on investors who rejoiced that the loss was smaller than expected and drove its shares up 9%. But the smaller-than-expected loss was primarily the result of accounting changes made in the quarter that allowed the company to book certain gains in earnings and exclude certain losses.

Freddie reclassified $90 billion in securities, boosting profit by about $1 billion compared with the fourth quarter.

Hat tip Calculated Risk

Analyst: There is a headline out there that you have level 3 assets of $157 billion. I was just wondering is that true and is that related at all to the markups of the 1.2 billion gain?

Freddie Mac: No, it is not Paul. We made a determination in the first quarter that given how widely the pricing we were getting on the abs portfolio [varied] that it no longer made sense to leave that into level two. So we essentially moved the entire abs portfolio into level three. We were still using the mean pricing that we were getting from the dealers. So we’re not using a model price. That is all that is. It has nothing to do with the trading portfolio

Another change -- related to its mortgage guarantees -- reduced a potential hit to profit by about $1 billion compared with the fourth quarter. A maneuver that delays taking credit losses also allowed the company to avoid losses in the quarter.

Excluding these and some other accounting changes, Freddie's modest $151 million loss would have been a more worrisome $2 billion.

More insights via Calculated Risk On Freddie Mac Accounting Change

One way to cut through the earnings noise is to go to the balance sheet and zero in on its leverage -- the amount of shareholders' equity Freddie has supporting its $803 billion of assets, which are the loans it has retained.

In the first quarter, Freddie's assets exceeded its $16 billion of shareholders' equity -- its leverage ratio -- by 50.2 times. Fannie's first-quarter leverage ratio was 21.7 times, while the first-quarter average for the 20 largest U.S. lenders was just under 12 times, according to data from SNL Financial.

A Freddie spokesman declined to comment on its leverage specifically. And to be fair to Freddie, some of the market losses that are driving down Freddie's equity may one day be recovered. For instance, equity plunged to $16 billion from $26.7 billion in the fourth quarter, in part because of unrealized losses on securities backed by subprime mortgages.

But if Freddie were a regular bank, its regulator wouldn't let leverage get anywhere close to 50 times. At a nosebleed level like that, the regulator would push Freddie to keep raising capital, even if some of its losses in equity might be fleeting.

Shareholders could sputter about the continued dilution, but the government won't be very sympathetic.

More Reasuring Facts On Phony Mae aka Fannie Mae

This is an update on yesterdays post Reasuring Phony Mae & Fraudie Mac Facts........ The stock was under pressure premarket ( down 15 percent ) and closed higher with almost 9 percent. No wonder when you read the "bullish" points the WSJ is making...... Got gold......? More via Minyanville Five Things You Need to Know: Fannie Mae Inadvertently Predicts Housing Bottom & Barry Ritholtz Fannie Mae is Fantastic !

Das ist ein Folgepost zum dem gestrigen Eintrag Reasuring Phony Mae & Fraudie Mac Facts........ Vorbörslich war die Aktie start unter Druck und notierte bis zu 15 % schwächer. Geschlossen hat Phony Mae 9% höher. Muß wohl an den bullishen Fakten die das WSJ zusammengetragen hat liegen..... Got Gold....? Hier teilweise substanzielles von der FAZ Riesige Verluste können Fannie-Mae-Aktie nicht dauerhaft belasten sowie substanzielles via Minyanville Five Things You Need to Know: Fannie Mae Inadvertently Predicts Housing Bottom sowie Barry Ritholtz Fannie Mae is Fantastic !

Will $6 Billion Do for Fannie? WSJ
That is the amount of new money the mortgage giant said Tuesday that it would raise through the sale of common and preferred stock. But Fannie Mae could need even more capital if it really wants to shore up its balance sheet while also backstopping the national housing market.

How much more depends on an investor's view of the best way to measure the firm's net worth, as well as the amount of capital it should put aside against its burgeoning mortgage book. Bearish outlooks on these counts lead to scenarios where Fannie needs to raise anywhere from $5 billion to about $15 billion in additional funds.

Underpinning those pessimistic outlooks are the considerable headwinds that Fannie continues to face. The company posted a $2.2 billion first-quarter loss, for its third consecutive quarter in the red. The government-sponsored provider of funds for home mortgages expects national housing prices to fall 7% to 9% this year, while its exposure to hard-hit areas such as California and Florida could cause it even greater pain.

Fannie may soon have to book some big, unrealized losses it has been sitting on, further reducing its book value, or net worth.

Especially alarming: Based on market values for assets it holds, Fannie's net worth attributable to common stockholders would have been a negative $2 billion at the end of March.

For its part, Fannie doesn't see any need to raise more than $6 billion in capital. Chief Executive Daniel Mudd said on a conference call that the new funds will protect Fannie's balance sheet against future losses, allow it to expand its business and enable it to act as a bulwark for the housing market nationwide.

Mr. Mudd told investors that -- including the $6 billion in new capital, a 29% dividend cut and regulatory capital relief -- Fannie will have $48 billion in capital. That, he added, is $17 billion more than the company's federal regulator said it needs.

"We will feast off this book of business we're putting on for many years to come," Mr. Mudd said. Fannie's stock rose $2.52, or 8.9%, to $30.81 at 4 p.m. in New York Stock Exchange composite trading.

Some investors even felt Fannie didn't need to raise any new money. But that view is based on the idea that market-value losses shown by Fannie are fleeting.

Bears don't buy that, especially given the unprecedented scope of the housing crisis. They say it is a mistake to look at Fannie's regulatory capital number, which excludes large unrealized losses.

These investors argue that Fannie's market-value balance sheet gives a clearer picture. At the end of March, this market-value view showed the firm with total net worth of $12.2 billion, a bruising $23.6 billion decline from $35.8 billion at the end of 2007.

This figure comprised $14 billion in net worth attributable to preferred stock holders, while that attributable to common holders was negative $2 billion.

That $12.2 billion is the effective balance-sheet cushion against future losses. But it is equivalent to only 1.4% of Fannie's $866.7 billion in assets, measured using market values.

Not all the market-value losses will come to pass, of course. But some likely will. Fannie, for instance, disclosed that $16.9 billion of the $23.6 billion decline in market-value net worth came from increasing the value of a liability that represents future payouts on mortgage guarantees.

The increase in this guarantee obligation reflects, in part, new, higher estimates of credit losses. If these credit losses were to occur, they would show up on Fannie's books as cash payouts and realized losses.

Fannie may face pressure on earnings and its net worth in other areas. It disclosed that at the end of March it had $9.2 billion in unrealized losses on securities that haven't so far been reflected in earnings. Of these, $5.4 billion are more than a year old.

In addition, Fannie has so far balked at creating a special reserve against any portion of its $17.8 billion in deferred tax assets. The company can use those only to offset profit. As its loss-making period stretches, arguments could grow louder that Fannie needs to reserve against part of this asset. Doing so would result in another charge against profit that would hit net worth.

Those kind of charges could leave Fannie's $6 billion cushion looking awfully thin.

Reasuring Phony Mae & Fraudie Mac Facts.......

Schould be an interesting call today........ Got gold? UPDATE: Stock under pressure premarket......... No wonder when you read through the Q1 Investor Summary Fannie Mae ( especially the delinquency rates starting page 22 ). Now up over 5 percent!

Sind das nicht beruhigfende Daten und Fakten zu den wohl wichtigsten Finanzinstituten weltweit...... Wird sicher eine interessante Telefonkonferenz........Got Gold? UPDATE: Aktie vorbörslich stark unter Druck. ......Sollte bei Durchsicht der folgenden Präsentation Q1 Investor Summary Fannie Mae nicht weiter verwundern. Lege Euch besonders die Charts zu den notleidenden Krediten ab Seite 22 ans Herz. Inzwischen über 5% im Plus!

Doubts Raised on Big Backers of Mortgages NYT
Fannie Mae and Freddie Mac now overwhelmingly dominate it, handling more than 80 percent of all mortgages bought by investors in the first quarter of this year. That is more than double their market share in 2006.

But some financial experts worry that the companies are dangerously close to the edge, especially if home prices go through another steep decline. Their combined cushion of $83 billion — the capital that their regulator requires them to hold — underpins a colossal $5 trillion in debt and other financial commitments.

The companies, which were created by Congress but are owned by investors, suffered more than $9 billion in mortgage-related losses last year, and analysts expect those losses to grow this year. Fannie Mae is to release its latest financial results on Tuesday and Freddie Mac is to report earnings next week.

bigger/größer

The companies are sitting on as much as $19 billion in additional losses that they have not yet fully acknowledged, analysts say. If either company stumbled, the mortgage business could lose its only lubricant, potentially causing the housing market to plummet and the credit markets to freeze up completely.

By the end of last year, the companies had guaranteed or invested in $717 billion of subprime and Alt-A loans, up from almost none in 2000.

Last year, in return for buying billions of dollars of subprime mortgages to help stabilize the market, executives won the right to expand their investment portfolios. In March, the companies agreed to raise more capital within the year. In exchange, they received an additional $200 billion in purchasing power.

UPDATE:

I think you can add another $ 200 bilion..... Party on.....

Nach diesen Meldungen dürfte wohl noch mal eine ähnliche Summe hinzukommen.... Die Party geht weiter.....

Marketwatch Fannie Mae's federal regulator said on Tuesday it will reduce the company's capital-surplus requirement to 15% from 20% when Fannie Mae completes a new capital-raising plan. Fannie said Tuesday it is planning to raise $6 billion in new capital. The mortgage-finance giant reported a first-quarter loss of $2.2 billion on Monday, or $2.57 a share, citing credit-related expenses

> On top of this Fannie is hinting that another 5 percentage point reduction to 10 will be in place in September 2008 ( see end of page 1 Press Release!)

> Darüberhinaus wird angedeuted das eine weitere Reduzierung um 5 Punkte auf dann 10% wohl Ende September kommen wird ( siehe Ende Seite 1 Press Release )

“We’ve taken tremendous risks by loosening these companies’ purse strings,” said Senator Mel Martinez, Republican of Florida and a former secretary of housing and urban development. “They could cause an economywide meltdown if they got into real trouble and leave the public on the hook for billions.”

> When watching this tiny spread it should be clear that the market is already assuming that there will the biggest bailout ever....

> Beim Betrachten dieser lächerlichen Risikoaufschlägen sollte jedem klar sein das hier der gigantischte Bailout der Geschichte bereits als gegeben hingenommen wird. Leider wohl mal wieder zurecht.....

Last month, the companies promised to pump money into the more expensive reaches of the housing market. In return, Congress temporarily raised the cap on the size of the mortgages they can buy to almost $730,000 from $417,000

> Here is more on Phony & Freddie from Contrary Investor

Again, please remember that the important numbers to focus upon are the twelve month moving average amounts. These are the numbers that are really showing us trend and potentially important trend change from a historical perspective. In fact, although it's just our opinion, we believe what you'll see below is not being given enough attention in financial market circles these days. First up is foreign purchases of US government agency securities. In the past, what has attracted foreign interest, at least we believe so, has been the yield spread differential between government agency paper and Treasuries. You can clearly see that since the summer of last year, foreign community purchasing of US government agency paper has cooled down meaningfully. The last time we saw this type of a drop off was when it became known that Freddie, and then Fannie a short while later, were no longer able to file audited financial statements

Remember, these are numbers through February. What had not yet transpired when these numbers were reported was the revelation of increased lending limits for Fannie and Freddie in conventional mortgage lending from $417K to $729K. Moreover, the OFHEO had also not yet allowed lowered capital requirements for these two mortgage paper behemoths, further allowing them to mushroom their balance sheets relative to total capital should they choose to do so in the future (which they will choose to do so - count on it). The question becomes, what will foreign community reaction to these two news items be come the March and April numbers for foreign purchases of US agency paper? Implicit with the hike in nominal dollar lending limits and the allowance of balance sheet growth on what will be a defacto smaller capital base is increased financial risk. You already know we'll be sure to let you know foreign reaction vis-à-vis forward purchasing of agency paper. The bottom line being? The answer will be a matter of confidence. And it sure as heck appears clear that confidence in US financial paper has already become a very meaningful issue for the foreign community really since last summer.

As you'll see below, to suggest that the foreign community has been an important support to cost of capital at the government agency level, and ultimately the cost of mortgage debt in the US over time, is a wild understatement.

> The US should be very fortunate that they have found enough "dump" money to accumulate these kind of secirities..... CHAPEAU ( no kidding )!

> Die US können sich in der Tat wirklich glücklich schätzen das es Ihnen gelungen ist soviel ausländischen Kapital in solch Papiere zu lotsen. Ziehe aufrichtig meinen Hut vor solch guter PR!

Freddie Mac's Accounting Evokes Shades of Enron: Jonathan Weil

It´s no surprise some call them "Phony Mae and Fraudie Mac".... Just in time Fannie is also out with some news. Fannie Mae Cutting Dividend 30 Percent, Selling $7 Billion in Preferred Stock to Raise Capital

Sie werden nicht umsonst auch "Phony Mae and Fraudie Mac"genannt....... Passend hierzu ist auch Fannie mit einer Meldung draussenFannie Mae Cutting Dividend 30 Percent, Selling $7 Billion in Preferred Stock to Raise Capital

Dec. 5 (Bloomberg ) -- You have to wonder if a company is playing games when its earnings hinge on predictions no mere mortal is capable of making. That's one of Enron Corp.'s great lessons. And it's one that Freddie Mac investors might heed now.

Before it collapsed in 2001, Enron recorded large profits by estimating the values of its future cash flows from energy contracts that extended 20 years or longer. It then booked those amounts as current earnings. Even if Enron's executives had been acting in good faith, which they weren't, the forecasts they made weren't humanly possible.

Freddie's results depend on similar predictions, with a twist. The Mclean, Virginia-based company is using far-out forecasts of future cash flows to avoid recognizing large losses in its net income and capital. To believe Freddie's financial statements, you must believe the government-sponsored mortgage financier can make prognostications about its cash flows and debt issuances as long as 26 years from now.

Here's how the accounting works. Freddie's Sept. 30 balance sheet shows $4.3 billion of pent-up losses on derivatives called cash-flow hedges. Companies use these side bets to guard against interest-rate fluctuations on, for example, variable-rate debt.

Changes in the hedges' values don't hit net income immediately. Instead, they go into a line in shareholder equity called accumulated other comprehensive income, or AOCI. From there, they are released gradually into net income as payments come due.

Doesn't Count
These losses also don't count in the primary gauge the government uses to measure Freddie's capital, the financial cushion that helps any company absorb losses. Had Freddie counted them in net income, it would have fallen $3.7 billion short of its minimum capital requirement at the end of the third quarter.

Freddie says it has closed out almost all its cash-flow hedge positions, meaning the losses are now fixed. It says about 70 percent of its AOCI will be released into earnings over the next five years. The rest will take longer.

So what's getting hedged? Many of the hedged items don't exist yet. That's because they are ``forecasted transactions,'' primarily future issues of debt. The company says it has hedged the cash-flow risks on such deals as far out as 2033.

Under the accounting rules for derivatives, a future deal must be ``probable'' to qualify as a hedged transaction. So must the deal's terms, such as size and timing. This is where the forecasts get tricky.

Think Back
Consider how hard it would have been for a company in 1981 to envision and hedge its cash-flow risks on a debt sale it thought back then that it would make in 2007.

``Who could have predicted the Internet being where it is today?'' Ketz says. ``Who could predict that China would be the economic power that it is? Even in the U.S., the decline of, say, General Motors -- I don't think anyone would have predicted that in 1981. These are structural changes that affect the society and economy, and they can affect the cash flows that occur.''

Predictions even a few years out are tough. Will the next president be a Democrat friendly to Freddie and Fannie Mae, or a Republican who's not? How much more will home prices fall in the next year? Where will interest rates be? And wouldn't these developments affect Freddie's business and plans?

Consider the History
A Freddie spokeswoman, Sharon McHale, says the company knows its forecasted transactions are probable because it ``has a history of issuing significant amounts of debt instruments, well in excess of amounts hedged.'' The mortgages and mortgage securities it purchases stretch over 15 to 30 years, she notes, while the longest maturity for Freddie's debt is 10 years. Therefore, ``we know there is a need for debt issuances in the future to fund existing and future mortgage securities that have not fully prepaid prior to their stated maturity.''

Still, knowing the need will exist isn't the same as knowing what the terms and risks will be.

Judging by Freddie's $34.6 billion of so-called core capital at Sept. 30, which was about $600 million above the government-set minimum, Freddie already was adequately capitalized. And by keeping its $4.3 billion of losses in the AOCI holding tank, Freddie is signaling that a like amount of benefits will materialize in years to come.

Nonetheless, after posting a $2 billion net loss for the third quarter, Freddie last week had to raise $6 billion through a preferred-stock offering and cut its dividend by half to shore up its dwindling capital. That undercuts the notion that its cash-flow hedges are working properly. If they were, then Freddie should be getting around $4.3 billion of gains over the next 26 years. So there would be no need for a capital infusion.

Yet there was such a need. And until just recently, Freddie didn't see it coming. The lesson for investors: Freddie's crystal ball is no better than yours.

> Got gold......?

Jim Rogers On "Phony Mae and Fraudie Mac"

Make sure you hear the "amusing" Bloomberg Interview with one of my heros Jim Rogers. Here my take from yesterday Freddie Needs Fresh Capital...... It´s funny to see how the reporter tries to defend Freddie & Fannie.... But he is by far better than this must see example from FOX Business News. They even make Mark Haines look smart......

Hier das extrem amüsante Bloomberg Interview mit einem meiner Helden Jim Rogers sowier mein gestriges Post zu diesem Thema Freddie Needs Fresh Capital...... Man kann fast das Gefühl haben das der Reporter sich vor Angst fast überschlägt. Aber in jedem Fall besser als dieses Beispiel vom angeblichen Wirtschaftssender FOX Business News

Freddie, Fannie Shares Will Continue to Slide, Jim Rogers Says
Nov. 20 (Bloomberg) -- Freddie Mac, which today dropped the most ever after posting a record loss, and rival mortgage lender Fannie Mae will continue to tumble because of bad home loans, investor Jim Rogers said.

``I'm still short those companies, they both have a long way to go as far as I'm concerned,'' Rogers said in an interview. ``Neither one has a clue what's on their balance sheets.''

Freddie Mac, the second-largest U.S. mortgage company, warned of a possible cut in the dividend and the need for additional capital. The worst housing slump in 16 years caused ``significant deterioration'' in the third quarter that will continue through year-end, Freddie Mac said after reporting a net loss of $2.02 billion, or $3.29 a share, three times what some analysts estimated.

Rogers, who predicted the start of the global commodities rally in 1999, advised in a Nov. 5 interview with Bloomberg that investors should avoid financial stocks. In March 2006, he said Fannie Mae shares would decline.

Make sure you read Drilling Deeper into the Freddie Fiasco from Greenberg!

Laßt Euch auf keinen Fall Drilling Deeper into the Freddie Fiasco von Herb Greenberg entgehen!

Thanks to Rodger Rafter for the term "Phony Mae and Fraudie Mac"