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$1.34 -0.22 (-14.10%)
10/3/2008 4:02 PM

Fannie Mae (FNM)

CAPS Rating:
**

A shareholder-owned company, which provides affordable housing capital to local communities in order to serve the U.S. housing market.

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Avatar ikkyu2 (99.38) Submitted: 12/06/06 4:49 AM : Outperform Start Price: $54.40 FNM Score: -78.82

If I hear the words "housing bubble" one more time in reference to this stock I'm going to puke.

This is the company that invented asset securitization; their product is not loans. It is, rather, a method of making a market to price risk efficiently. Whether or not there is a lot of downside risk in this market is not going to affect FNM's ability to profit off the process of making the market.

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Avatar ikkyu2 (99.38) Submitted: 9/02/08 11:14 AM

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Wow, did I ever get this one wrong. Apparently even a 1% default rate on prime loans can throw a $60B market cap GSE into a situation where loss of all shareholder's equity occurs. Hooray for poorly-understood credit derivatives used at maximum leverage.

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