It was a choppy day which was helped along by the wacky moves in Freddie & Fannie. On the same day that they announced huge losses the Office of Federal Housing Enterprise Oversight (OFHEO) decided to lift the portfolio cap restrictions they put on Freddie & Fannie in 2004 in response to their accounting irregularities. So now that they're accounting properly they've been rewarded for telling us stuff like this:
Government-sponsored home loan giant Fannie Mae announced a quarterly loss today that, even in the currently ugly world of mortgage lending, should make some eyes pop.It lost $3.55 billion. Again, that's in a quarter. That's more than $39 million a day, more or less. That's about $1.625 million an hour, $27,091 per minute and more than $451 a second, very roughly rounded.
Is it any wonder that the dollar's trading at all-time lows? Ah, fun times... Here's what Fannie Mae's stock (FNM) did today:
My comments on the indices are basically the same as yesterday. Here are the charts:
No Changes
| Trend | Nasdaq | S&P 500 | Russell 2000 |
| Primary | Down | Down | Down |
| Intermediate | Down | Down | Lat |
| Short-term | Up | Up | Up |
(+) Indicates an upward reclassification today
(-) Indicates a downward reclassification today
Lat Indicates a Lateral trend
*** I'm simply using the indices' relations to their 200, 50 and 10-day moving averages to tell me the long, intermediate and short-term trends, respectively.
Funny how the homebuilders rallied yesterday on terrible housing news also. Nobody told me it was backwards week. I don't know if the idea is bad news means rate cut or bad news means we've hit bottom and can only go up from here. Maybe a little of each.
Wow - thanks for pointing out that monster volume on FNM! This *must* be a major point for the stock. And now, FNM and FRE are empowered to help load up Americans with even more debt than we can handle. Thank you!
Homebuilders could continue to rally on the news as long as folks believe relaxing the cap will generate more demand for housing.