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September 2008



Conservative Analysis of Credit Crisis and Economic Downturn

September 24, 2008 – Comments (7) | RELATED TICKERS: C , SKF , AIG

in 1999 there was $160m of subprime loans with a default rate of about 2% as the CDA was offset by strong anti-predatory lending laws and state enforcement.   [more]



FNM/FRE: Pump, pump, shot, rolls around the rim and

September 08, 2008 – Comments (1) | RELATED TICKERS: SKF , FNMA , FMCC

rolls around the rim again, and again, and again...  While I agree with Buffett that this action to save FNM/FRE was right, I think people are missing the point.  People are focusing on the equity markets, when they should be focusing on currencies and the general economy.  In the short run the U.S. is still in deep dudu.  The stock market rebound is a dead cat bounce.  Sell what you want to get rid of into strength, it won't last.  [more]



A few words on Fannie and Freddie

September 07, 2008 – Comments (9)

So, the GSE's finally got taken over by the Federal Govt.  Nice.  Let's see what it means.  First it means that common stock holders will be diluted by about 90% so expect to see both stocks around a buck soon.  What, you didn't read that.  Well take a look.  The Govt can buy up to $100b in common essentially to capitalize the companies which are undercapitalized by at least that much.  It'll happen, even if they are only starting with a billion.  SKF I've been touting, watch it run now.  [more]