Fears fester at Freddie Mac
The news keeps getting worse at Freddie Mac (FRE). The big government-sponsored mortgage investor saw its shares plunge 29% in a day last week after the company posted a $2 billion third-quarter loss and said it was considering halving its dividend in a bid to shore up its capital base. Then, on Friday, The Wall Street Journal reported that Freddie could face a big writedown of mortgage-related securities. The paper reports Freddie holds $105 billion worth of mortgage bonds issued by Wall Street firms. Freddie’s finance chief tells the Journal there’s no need for a writedown, given that the securities are almost all triple-A rated. That sounds depressingly similar to what Citi (C) and Merrill Lynch (MER) were saying just before they took multibillion-dollar writedowns on their subprime securities and collateralized debt obligation holdings last month. Wondering where all this could end up? Felix Salmon sketches out what might happen if further losses end up making Freddie Mac insolvent.
- Big tab for Lehman swap sellers
- Morgan Stanley tumbles again on possible downgrade
- More taxpayer money for AIG
- Legg Mason downgraded
- Feds back Morgan Stanley deal
- BofA halves dividend
- Wachovia: Citi’s loss, Buffett’s gain
- Citi left at the Wachovia altar
- Buffett support fails to lift GE
- Buffett finds GE in bargain basement
- shame on you for such a shocking head... More
- Isn't it a pity that the 'uptick' rul... More
- I invest like many others. And every... More
- You must be kidding me when you said... More
- I wonder if Henry Paulson will let Go... More
- I would like to request that Mr. Mozi... More
- if wells fargo is allowed to buy wach... More
- I am a current employee of ccity. It'... More
- AIG needs more taxpayer money, and no... More
- Know how bad GE stock has become...We... More
- Accrued Interest
- Aleph Blog
- Bespoke Investment Group
- Big Picture
- Calculated Risk
- Dealbook
- Econbrowser
- Felix Salmon
- Financial Armageddon
- Footnoted
- FT Alphaville
- Infectious Greed
- Naked Capitalism
- RGE Monitor
- Seeking Alpha
- Information Arbitrage
- Mish's Global Economic Trend Analysis
- Fortune on CNNMoney.com




