To the depths and back
Thankfully my trip to the land of colorless caps was short lived. After the wrath that Odyssey Marine unleashed on me, I had the good fortune of a quick windfall from a few beat up lenders. Fremont General (FMT) was the big one -- it announced the sale of its commercial real estate lending business for $1.9B (it had already sold off its subprime loans). A couple other picks, particularly Impac Mortgage (IMH), an Alt-A lender, also rallied on the news.
I had gone out on a bit of a limb for these lenders, but I also felt like I had a fairly good amount of comfort given that they were all trading at something like 0.4x book at the time I gave them the thumbs up. Sure, it's not much comfort if they all went out of business, but I figured that either the picture would start looking less than absolutely dire or somebody would step in on behalf of a couple of them.
Now we see if the gains hold up.