Dollar "bounce" is over with. Time to buy oil and the energy sector again . . . especially as Beijing's Paralympics comes to a close on Sept. 17th and the 5 surrounding provinces crank their industrial complex back up!
If the stocks are still trading on Monday, I think the trading action will be even crazier .... maybe a billion share day for each company?
The fact that they are changing management seems pretty telling. if shareholders were going to be bailed out you would expect the management putting resistence and that would include their jobs. that fact that they didnt shows that the government set the tone. I'm quite surprised these stocks are only down 15%, perhaps they are being hopeful its a rumor
I think someone knew of what was happening today with the financials as most of the day they traded higher. What happens this weekend is anyone guess. Funny to see FRE and FNM down over 10% and the rest of financials trading higher. Six months ago if someone said FRE and FNM had to be bailed out you would have thought they were crazy. Who knows what's next.
I agree that it's surprising the shares aren't down more. Repost from earlier about reasons why the stocks are still well above zero: (1) Specific details of bailout unknown. ("creative use of Treasury's new authority to make a capital injection") (2) FRE and FNM bailout is just a rumour at this stage, and not confirmed. (3) Blind hope that the shares may have value.
I disagree. If the WSJ article was known earlier in the day, then it follows that FRE and FNM would have been down in regular hours today. FNM was up 9% at 4pm.
Short the Dollar Long Commodities & Energy ECB gets tougher on ABS (Asset Backed Securities) while the Fed sucks up ('back stops') Fannie & Freddie's $12 trillion in outstanding home mortgage debt. Financials will bounce big, then what???
http://www.forbes.com/personalfinance/forbes/2008/0915/154.html This one has great timing.. printed only a few days ago "For tax-deferred accounts, I'd take a big breath and double down, buying more at the current low prices. Risks include the housing market getting even worse and equity holders getting hammered by a Treasury intervention. Not a trivial possibility."