Find the Treasury Leak

I want you to think of something that's amazing when you mull it over. Do you know that Barron's could run the exact same article on Fannie (FNM - commentary - Cramer's Take) and Freddie (FRE - commentary - Cramer's Take) this weekend that it did two weeks ago? Nothing has changed other than the losses getting bigger and the price FNM/FRE pays for money is more expensive. In fact, I could argue it is much worse than it was when Barron's wrote that the Treasury is ready to take them over, because the home price numbers force both to book losses. I don't care that Barney Frank says they are fine, or that Merrill Lynch (MER - commentary - Cramer's Take) says they are fine. I want to know what the guy at Treasury who was the source thinks now that the situation has worsened dramatically for all but the stock since the article!

When that article appeared, Fannie Mae was right about where it is now. Was the whole thing a fiction? Was it just a dream? Was it made up? Was Treasury not worried at all? Was this contingency one of thousands and not really being considered? Was nationalization something that they will only do if Fannie and Freddie fail to raise money, have some sort of auction that produces junk-like returns? Was it a plan that is no different from a plan that Homeland Security has made up for a suitcase bomb in Manhattan or a nationwide outbreak of something like the flu that Stephen King wrote about in The Stand?

Otherwise, why the heck are these two up?

The longer this nonsense keeps up, the more we should demand a follow-up by Barron's about who in the Treasury leaked the plan and whether the plan was simply a worst-case disaster plan and nothing that was seriously on the table.

Otherwise, I am beginning to wonder whether what we had here was no more than a traditional Barron's hit job with the shorts ready to pounce, something that doesn't seem like Jonathan Laing's game -- I always viewed him as above the other writers when it comes to hard-hitting writing.

Was the Treasury plan all a dream?

Was the real story simply, "Let's have forbearance for these two companies and simply continually say they are well capitalized and not worry?"

That's what it seems now.

Incredible, isn't it? The woes of Fannie and Freddie have increased dramatically since that article, but FNM is closing in on a double from when the fallout of that article hit.

Something's really fishy.

Something makes no sense ... unless the article made much too much of a plan that existed only in the event of FNM/FRE nuclear war.

Random musings: Kass is still short these two; bravo!

At the time of publication, Cramer had no positions in the stocks mentioned.

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