Melissa Lee hosted CNBC's "Fast Money" Friday night. She started the show with a discussion on late-breaking news that the Treasury is planning to backstop Fannie Mae( FNM) and Freddie Mace( FRE). The plan would include changes to senior management.
Steve Liesman, senior economics commentator for
, joined the traders to discuss the plan by the Treasury to inject capital into the two companies. He said the rumors on the Street are that the Treasury will offer a convertible preferred or a warrant offering. Guy Adami asked Liesman if the stocks are going to zero. Liesman said he was unsure and said we're back to where we were before on these equities.
If the government wipes out the preferred holders, it will create other problems in the banking sector, he added. Pete Najarian said the problem is that we don't have enough clarity on what this means for the Freddie and Fannie shareholders. Jeff Macke added that both stocks are screaming sells, along with the
Financial Select Sector
Adami mentioned that if the backstop of Fannie and Freddie can lower mortgage rates, the entire problem could begin to unwind itself. Karen Finerman said the plan is bad for the Treasury and bad for the U.S. dollar.
The Tech Beat
Lee moved the discussion over to the technology sector. Finerman said she likes
, but she didn't like that the company warned on earnings today. Macke pointed out that
got crushed all week, and the stock isn't working.
The Chart of the Day was
Research In Motion
( RIMM). The stock has been hammered down 20% in just the last 10 days. Adami said the chart on RIMM is broken and said the mind-set in the market has changed toward this stock.
Macke mentioned that
has a management problem and said he wouldn't buy the stock ahead of the product release next week. He said that if Steve Jobs doesn't show up on Sept. 9, the stock is going materially lower. "The market rumors are that Apple will release something surrounding the iPod," added Najarian. He said he wouldn't buy the stock based off that chatter.
In the Oil Patch
Next, Lee turned the conversation toward crude oil. Adami said that if the dollar starts moving lower off the Freddie and Fannie news, expect crude oil to start trading higher. Najarian explained that the fall in oil is finally pushing the refiner stocks up. He loves the action and if oil keeps going down through $100 the refiners will continue to benefit. One refiner stock he likes is
announced it has agreed to buy the smokeless tobacco company
for $10 billion. Finerman said she likes the deal for Altria and said she is long the stock. Najarian highlighted that the call options in UST were "unbelievable" ahead of this deal. He explained that the options action went nuts when UST pulled out of a conference a day earlier.
were among the most actively traded stocks on the
Back to Apple
Ben Reitzes, Lehman Brothers' Apple analyst, joined the traders to discuss Apple's new products. He said he expects new iPods and a big price job to the iPod Touch. Reitzes mentioned that Apple will probably release a new Mac computer next month. "Music is super important, so I think the company will revamp iTunes," he added. Reitzes said that if the company produces revenue upside, the stock will work into year-end.
Steve Liesman rejoined the traders to talk about some more breaking news with Fannie Mae and Freddie Mac. Liesman said that the Treasury is confirming that it's making progress with its discussions with
, which is consulting on the situation. He mentioned that the government wants to get rid of the current management at both firms, and that would be a negative for the stocks. Stocks of Freddie and Fannie were dropping sharply in after-hours trading.
Macke said to sell
. Adami picked
. Finerman selected
. Najarian recommenced
This article was written by a staff member of TheStreet.com.