General Question

isorabins's avatar

If the government takes over freddie and fannie mac, will the stock be worthless?

Asked by isorabins (50points) August 13th, 2008
3 responses
“Great Question” (1points)

and a related point, should the stock rally if the government bails them out, but allows them to remain independent?

Observing members: 0
Composing members: 0

Answers

allengreen's avatar

Yes, the stock will go to zero

allengreen (1631points)“Great Answer” (0points)
marinelife's avatar

The government is unlikely to take them over. After the bailout was announced, the stock jumped.

marinelife (62485points)“Great Answer” (0points)
allengreen's avatar

marina, you are wrong, and a simple Google of this topic will illuminate the reality of insolvency at both Fannie and Freddie.

The stock jumped as a result of SEC banning shorting of 19 financial stocks, the two mentioned above included.

Fannie and Freddie will be taken over in the very near future, as they are insolvent and do not have enough finanical reserves in relation to the number of defaulted loans in the portfolio.

allengreen (1631points)“Great Answer” (0points)

Answer this question

Login

or

Join

to answer.

Older »
What makes you think your house is haunted?
« Newer
Where would you want to live?

Mobile | Desktop


Send Feedback   

`