NEW YORK ( TheStreet) -- The Fannie Mae ( FNMA) and Freddie Mac ( FMCC) roller coaster continued on Friday, with shares of both companies rebounding after two days of significant losses. Shares of Fannie Mae rose 21% on Friday to close at $2.10. The shares had suffered a decline of 58% over the previous two sessions though Thursday's close at $1.73. That decline followed an increase of 140% the preceding week through Tuesday when the stock closed at $4.08. Freddie Mac's shares were up 27.5% to close at $2.04. Freddie's shares had fallen a 57% over the previous two sessions through Thursday's close $1.60. The shares had risen 150% through close at $3.75. The extreme volatility reflects the uncertain future for the two companies, known as the government-sponsored enterprises, or GSEs, which were taken under government conservatorship in September 2008. The GSEs together hold roughly $5.2 trillion in mortgage loans and mortgage-backed securities, and remain critical to the U.S housing market, as they purchase roughly 90% of newly originated mortgage loans in the U.S.
Common shares of both companies traded for just 26 cents at the end of 2012. A major catalyst for GSE shares was provided last Friday by Ralph Nader, who describes himself as a "faithful" GSE shareholder. Nader in an op-ed piece in the Wall Street Journal wrote that the two companies' common shareholders should fight against the federal government's "great Fannie and Freddie rip-off." As part of its bailout agreements with Fannie and Freddie, the GSEs granted the government warrants to purchase just under 80% of the common shares of the two GSEs at a strike price of $0.00001 per share. "The zombie common shareholders have no rights or remedies against Fannie and Freddie, both operationally active companies, or their regulator -- the Federal Housing Finance Agency," Nader wrote on Friday. "FHFA ordered the Fannie and Freddie boards and executives to suspend communications with shareholders and abolish the annual stockholders meeting."
Anticipating the expected negotiations between President Obama and Congress over the GSEs future, Nader wrote that "the common shareholders of Fannie and Freddie need to organize and make their voices heard in Washington. Clearly, they should have a say in how Fannie and Freddie are managed -- in the board room and in Congress -- from here onward."