SubscribeBailout or Buyout? Fannie and Freddie
September 7, 2008
From my MSN TopStocks post:
5:45 on a Friday night. Somehow I knew something was in the air. The end of day upward move for a market that should have traded lower made no sense. It appears that now, according to the WSJ, there is talk about a backstop for Fannie Mae (FNM) and Freddie Mac (FRE). It is a general consensus that any plan will have a very negative impact on the common shares and after hours shares are sinking. Freddie is now down 23% for the day and Fannie is down 20%. Wait, Freddie is down 25%, no 27%, uh……this is not pretty and I am not kidding.
Somehow, there is talk of a rally that will be in place as the market opens on Monday. Perhaps that is good news as I suppose that the guessing game is coming to an end and investors will be able to rest with the knowledge that we finally have a big fat failure, once and for all.
Read the rest of my post HERE
TDI Podcast 73: Tesla #16 - Fast Cars and Faster Markets
September 6, 2008
Guest: Jason McCabe Calacanis and Andrew discuss fast cars and faster markets. Technology to Tesla and back. We also have a hearty conversation about what is on the horizon for tech and how to benefit. Andrew also digs into the current situation with Fannie Mae and Freddie Mac and gives an update of the TDI Managed Growth Strategy (great week!). A few money making ideas are pack into this fun episode.
LISTEN TO PODCAST NOW | LISTEN @ ZUNE - @ iTUNES
Jason McCabe Calacanis is the founder and CEO of Mahalo.com, a human-powered search engine. Prior to Mahalo.com’s launch in May, 2007, he was an “Entrepreneur in Action” at Sequoia Capital, a position he held since December 2006.
Jason co-founded and was the CEO of Weblogs, Inc., a network of popular weblogs that was sold to AOL in November 2005. Upon joining AOL, he was appointed senior vice president. In addition, he was named general manager of AOL’s Netscape.
Prior to forming Weblogs Inc., Jason was the founder of Rising Tide Studios, which sold its flagship publication to Dow Jones.
By the way…Jason is waiting for his brand new Tesla. His is car #16 and is 100% electric and does 0-60 in 3.9 seconds. Check out the Tesla for yourself HERE.
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Stock Discussed in this episode: MasterCard (MA), ExxonMobile (XOM), Proshares Ultrashort Oil (DUG), Capital One (COF), Apple (AAPL), Google (GOOG), Valero (VLO), Yahoo! (YHOO), Fannie Mae (FNM), Freddie Mac (FRE), Proshares Ultrashort Financial (SKF)
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Why I am short MasterCard
September 5, 2008
My latest MSN Strategy Lab Journal Update: Lately there has been a generally accepted theory that credit card issuers with exposure to loan losses will have great difficulty in this slowing economy, while card companies that simply earn money from transactions will thrive.
That’s incorrect.
The latter group contains two well-known companies, MasterCard (MA) and Visa (V), that are considered card-processing companies. They earn money each time a card is used.
But don’t be fooled. These are by no means recession-proof and could see more selling pressure the longer the economy suffers. (See my related MoneyShow video, “Is credit priceless?“)
I know what you are thinking. There is a shortage of money out there, and many people have turned to their credit cards to help fund daily living. There’s no arguing this point. The figures show an enormous increase in credit card usage and a corresponding increase to personal debt over the last year.
But that just cannot continue indefinitely. Here are a few reasons card usage and the number of new cards will begin to decline:
Read the rest of the article on MSN Money HERE.…
The Week Ahead: Size matters, but does Sears?
August 25, 2008
It is no secret that markets have been tough for everyone and on Friday, Chairman Bernanke said, ” the crisis is softening growth, raising joblessness, and the Fed’s job is one of the most challenging in memory”. At the same time, he believes that the recent trend of the dollar will likely slow inflation. The market took that as good news and a reason to raise stocks and crush oil. Read more
TDI Episode 71: The Dick and The Lehman
August 24, 2008
Guest: Mish Shedlock and Andrew discuss Fannie, Freddie and the market direction. We take apart Ladenburg Thalmann’s banking analyst Dick Bove and look at Cramer’s recent discussion about the Fed, SEC and the markets.
Mike Shedlock / Mish is a registered investment advisor representative for SitkaPacific Capital Management. As Mish tell us, Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
LISTEN TO PODCAST NOW | LISTEN @ ZUNE - @ iTUNES
We are both amazed that Bove expects Lehman Brothers (LEH) to “shrink about $100 billion off of its assets” and that the investment bank is “stable enough to go through a tough environment.” Bove, speaking at the Reuters 2008 Investment Outlook Summit in New York on Wednesday, also said that it will be at least “three to four years” before Lehman is once again a “vibrant, growing company.”
What is really confusing is that Bove has recently upgraded Lehman. It is important to remember that a few months ago, he had suggested that we should all start to once again buy financial stocks as they have hit bottom. EXCELLENT TIMING, MR. BOVE - What should we do now?
Andrew also looks at the Cramer commentary from this week and how Cramer is suggesting that the market is rigged. If this is the case, how does buy-and-hold make any sense???
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Stocks Discussed: General Motors (GM) Ford (F) Lehman Brothers (LEH) Citigroup (C) Wachovia (WB) Washiongton Mutual (WM) Capital One Financial (COF) MasterCard (MA) Potash (POT) Mosiac (MOS) Freddie Mac (FRE) Fannie Mae (FNM)
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