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kdakota630 (29.92)

More Losses Expected for Fannie and Freddie

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August 05, 2008 – Comments (3) | RELATED TICKERS: FNMA , FMCC

By Elizabeth MacDonald

As the one-year anniversary of the housing and credit crunch approaches, investors in Fannie Mae and Freddie Mac have nothing to celebrate. They won’t see an end to the losses at these mortgage finance giants until after next year.

Moreover, a report from the regulator of the two mortgage finance giants gives embarrassing new detail on how Fannie and Freddie were mindlessly gunning the securitization engines well after the housing bubble had burst and Wall Street backed off.

Freddie Mac will report its second-quarter financial results Wednesday. Fannie Mae will release its results on Friday. Freddie Mac’s shares are down 88% this year, while Fannie’s shares have dropped 83%. More losses and writedowns for the two are likely on the way.

Complete Article

3 Comments – Post Your Own

#1) On August 05, 2008 at 1:46 PM, TDRH (99.68) wrote:

That is their directive.  The were recently allowed to buy into Jumbo mortgages.  The government will just print more money and make ours worthless.

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#2) On August 05, 2008 at 3:34 PM, DemonDoug (83.85) wrote:

I can't wait for those earnings reports.  When they come out with "worse than expected losses" the entire financial sector will look like it's fallen off an even bigger cliff.

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#3) On August 08, 2008 at 5:43 PM, kdakota630 (29.92) wrote:

DemonDoug, you got the "worse than expected losses" part nailed, since they were 3x worse than expectations, but the S&P still managed to go up 2.39%!  LOL!

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