interpretation of FNM/FRE news

Discussion in 'Stocks' started by scriabinop23, Jul 13, 2008.

  1. the GSE bailout is a 180 for the White House since all we heard is no bailout here..no bailout there

    there must have been some hideous scenarios put before Bush had he not agreed to what we have now.

    I have a sense that the to-big-to-fail bailout ship is leaving the dock..
     
    #21     Jul 13, 2008
  2. dhpar

    dhpar

    it is certainly leaving the docks without an american taxpayer...:D
     
    #22     Jul 13, 2008
  3. why? the stocks would be heavily diluted in this scenario.
     
    #23     Jul 13, 2008
  4. dhpar

    dhpar

    i haven't seen anything in the article about buying shares from newly issued equity. that would have to be passed by a general meeting of current shareholders- not like in case of bsc where special rules applied. or am i wrong?
     
    #24     Jul 13, 2008
  5. well the govt said they would consider even possibly taking an equity stake in the 2. that would mean they would have to sell more shares.....a lot more shares.
     
    #25     Jul 13, 2008
  6. Cutten

    Cutten

    Futures went up a lot more than 50 pre-market in Jan 2001 after the surprise Fed cut.

    There's no reason why the market should respond less to important news in the pre-market, compared to the normal trading hours. The news is the same after all, it will have the same impact on the fundamentals. If it can only move large in the regular day, does that mean that there's an arb here? Buy the futures just before the open, then sell for an insta-10 point+ profit as the news finally gets fully discounted on the cash open?
     
    #26     Jul 13, 2008
  7. no money has changed hands..

    all I think that has happened is that FRE and FNM wont have an auction that blows up on them..

    then it's too late..
     
    #27     Jul 13, 2008
  8. you think fnm will be at $20.20 monday?
     
    #28     Jul 13, 2008
  9. I like the stock part of it. Maybe the fed is reading my posts.

    Let's insert something glowing hot into the #$%#$% of the shorts.

    [​IMG]
     
    #29     Jul 13, 2008
  10. Maverick74

    Maverick74

    Actually yes, there is an arbitrage problem as it deals with gaps higher vs lower. Much harder to sell the cash basket on a large gap down in the futures vs buying the cash and selling the futures on the open.
     
    #30     Jul 13, 2008