This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Fannie Mae and Freddie Mac: Obama Losers (Update 1)

Fannie's preferred Series S shares (FNMAS), with a face value of $25, were down 4.5% to close t $4.87. The shares closed at just $1.67 on Dec. 31. Freddie Mac's preferred Series Z shares (FMCKJ), with a face value of $25, were down 3% to close at $4.95. Freddie's preferred Z shares closed at $1.75 at the end of 2012.

Senators Mark Warner (D. Va.) and Bob Corker (R., Tenn.) in June introduced legislation to wind-down Fannie and Freddie over five years, privatize most of the U.S. mortgage market, while putting in place a limited government backstop in the form of a "Federal Mortgage Insurance Corporation (FMIC), modeled in part after the FDIC." The Federal Deposit Insurance Corp. insures bank deposits by charging premiums to all U.S. banks and savings and loan associations.

FBR analyst Edward Mills, in a note on Tuesday, said the president's speech was likely to be "all but an endorsement of the Corker-Warner GSE reform proposal and would make any efforts at a recap of Fannie Mae and/or Freddie Mac even more unlikely."

But investors' battle with the government over Fannie and Freddie is far from over. The lawsuits challenge the legality not only of the revised bailout agreement, but of many aspects of the bailout, including its timing in 2008.


-- Written by Philip van Doorn in Jupiter, Fla.

>Contact by Email.

Philip W. van Doorn is a member of TheStreet's banking and finance team, commenting on industry and regulatory trends. He previously served as the senior analyst for Ratings, responsible for assigning financial strength ratings to banks and savings and loan institutions. Mr. van Doorn previously served as a loan operations officer at Riverside National Bank in Fort Pierce, Fla., and as a credit analyst at the Federal Home Loan Bank of New York, where he monitored banks in New York, New Jersey and Puerto Rico. Mr. van Doorn has additional experience in the mutual fund and computer software industries. He holds a bachelor of science in business administration from Long Island University.
2 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
FMCKJ $5.42 5.86%
FNMAS $5.22 1.36%
BAC $15.58 -1.10%
FNMA $2.50 3.31%
FMCC $2.49 3.75%


Chart of I:DJI
DOW 16,965.17 +52.88 0.31%
S&P 500 1,995.83 +15.91 0.80%
NASDAQ 4,770.3910 -20.7610 -0.43%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs