Rumour! Mother of all writedowns! (Fannie Mae)

Since 1968, Fannie Mae has helped more than 55 million families achieve the American Dream of homeownership :unamused:

A somewhat related item

There will be trouble ahead… I get the impression the yanks are losing control and don’t know which way they should be pulling.

These denials are usually a sign that something bad is coming after the bell. (So has been my limited experience of the last six months of taking an interest in financial matters!)

So, I expect something potentially earth-shattering to be made public tonight, with tomorrow for the markets to blow off a little steam, so that they have forgotten about it by monday and everyone can go back to making money!

This really was a weird one. It was actually more than a rumour, it was a belief. Did the treasury really need to say anything, unless something ugly is in the post? I tend to agree with yoganmahew.

Also, what’s the story with the treasury denouncing bailouts and the Fed cheerleading for a bailout? Shouldn’t that be the other way round?

Could it be the Caryle capital offload of 22 billion of agency mortgages in a firesale? Add to this Citi reducing its MBS load by 45 billion and there could be a flood of MBS at firesale prices. Add to this speculation that Thornburg mortgages (a jumbo mortgage provider) is close to bankruptcy.

With all this going on, the GSEs may not be able to sell on their mortgages. If they can’t do that, they can’t give out loans. If they can’t give out loans, prime loans in the US stop. That wouldn’t do much for house prices if everyone had to pay real cash!

More on the guarantee rumour:

Might the rumour be related to the write-down rumoured yesterday?