relmor

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  • Fannie & Freddie Bailout? - Fast Money Recap (9/5/08)
    Government giving capital to Freddie and Fannie caused a rally in both those stocks just two months a go. Now were told that since they are now going to help them, its bad for the stock? What?! If its good for the stock 2 months ago, why is it bad now? Based on this bs, Id buy both of them after this sell off. Sounds like a case of classic Main stream media bs to me. SO which is it? How can the government add capital to FRE and FNM, and at the same time whipe out stock holders? You would have to either dilute shares, or do something that would be bad for the company. How is government backstopping their loans bad for their stock price? If you knew your company could take chances, and take losses, and the government would just give you money, wouldnt your stock go up in value, not down? If a bankrupcy happened, that is what causes a stock price to go to 0. They are not declaring bankruptcy, nor is the government taking over the company, just replacing the CEO's. This move in a company losing money is always market positive. The stock price of FRE went from 5.10 to 5.75 upon initial announcement(correct response to this news). Only after did it drop to 3.80, before going back to 4.04. The latter was the manipulation, using rumor and speculation that the stockholders will be ruined(CNBC said that, so you know its bs), and that is irresponsible journalism, and that caused the price to drop. No facts caused it to drop. Someone should sue CNBC for that. Honest judge would rule that to speculate like that correlated with an illogical drop in stock price would prove manipulation.
    Sep 06 07:00 am |Rating: 0 0 |Link to Comment |View article

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