Market Currents

• Wednesday, November 18, 2009

• 11:02 AM Fannie Mae (FNM) and Freddie Mac (FRE), which together have taken more than $110B in capital infusions from the Treasury, stepped up their lending for apartment buildings as the commercial real-estate market peaked, and are now facing rapidly rising loan losses. 5 Comments

• Monday, November 16, 2009

• 16:23 PM Interest rates on new home loans likely have further to fall, as yields on mortgage securities from Fannie Mae (FNM) and Freddie Mac (FRE) tumble near six-month lows. While the Fed is slowing agency debt purchases, supply is declining faster, and bonds without government guarantees are underperforming those in the Fed's program. Comment!

• Monday, November 9, 2009

• 10:38 AM Fannie Mae (FNM +1%) may need to write down the value of its $5.2B low-income housing tax credits after the Treasury vetoed its plan to sell them. "We are evaluating whether Treasury's decision changes our prior determination that we continue to have the intent and ability to sell or otherwise transfer" the credits, Fannie says in an 8-K this morning. 2 Comments

• Friday, November 6, 2009

• 12:40 PM Fannie Mae (FNM -8%) quantifies its exposure to bankrupt Lehman Brothers (LEHMQ.PK), filing $15.8B in claims and expecting only to get a portion. The mortgage financier posted its ninth straight loss yesterday, of $18.9B. 1 Comment
• 10:48 AM Also buried in Fannie Mae's (FNM) SEC filing yesterday was that it agreed to sell $2.6B in unused tax credits to unnamed buyers, and received approval (.pdf) for the deal from its regulator, the FHFA. The Treasury is thought to be leery of signing off on the sale, reportedly to Goldman Sachs (GS) and Berkshire Hathaway (BRK.A). 8 Comments
• 09:55 AM Fannie Mae (FNM) plans to tap emergency funds for a fourth time this year, bringing its draws of taxpayer money to $60B. According to an SEC filing late yesterday, Fannie will seek $15B in Treasury financing after posting an $18.9B Q3 net loss. Analysts say the GSE will likely tap its entire $200B lifeline, and may still need more. 3 Comments
• 09:00 AM Premarket gainers: GSI +10%. KFN +8%. FAZ +5%. RBS +5%. NVDA +4%. SWKS +4%.
  Losers: CVI -13%. FRE -12%. FNM -12%. AIG -11%. CROX -10%. IRE -7%. FIG -6%. SD -6%. ABK -4%. CRH -4%. BCRX -4%. CNO -4%. CTIC -4%. CBS -4%. ING -4%. RCL -4%. MT -4%. 1 Comment

• Thursday, November 5, 2009

• 15:39 PM Fannie Mae (FNM) rolls out its Deed for Lease program, allowing homeowners facing foreclosure to deed their property to the lender and stay in their homes as renters. The scheme is only for borrowers who have already missed a mortgage payment, and who aren't eligible for mortgage mods. Fannie's incentive? Buying time for a housing recovery, and preserving the value of its nonperforming assets. 7 Comments
• 09:00 AM Premarket gainers: LAMR +16%. R +16%. ONNN +8%. DYN +7%. DIRI +7%. IRE +5%. BCRX +5%. NVAX +5%. MGM +5%. PCS +5%. CTIC +4%. CVM +4%. ING +4%. TRA +4%. QCOM +4%. AIB +4%. FNM +4%. CSCO +4%. CNO +4%. AMMD +4%.
  Losers: CVS -10%. AEO -10%. ARO -10%. WFMI -10%. DPTR -9%. BEE -8%. CF -7%. ATPG -7%. ABK -6%. Comment!

• Wednesday, November 4, 2009

• 08:43 AM Sources say Berkshire Hathaway (BRK.A) has joined Goldman Sachs (GS) in a bid to buy $3B in tax credits from Fannie Mae (FNM); the credits are virtually worthless to Fannie Mae. The government, which controls Fannie, is thought to be reluctant to approve a deal that would allow Goldman to save on taxes, but taking widely-respected Buffett as a partner could reduce the tension. 6 Comments

• Monday, November 2, 2009

• 08:15 AM Goldman Sachs (GS) is in talks to buy up to $1B in tax credits from Fannie Mae (FNM) for an undisclosed amount, but the government - which controls Fannie - is reluctant to approve a deal that would allow Goldman to reduce its tax bill "given the animus held by many lawmakers toward big Wall Street firms in general, and Goldman in particular." 5 Comments

• Thursday, October 29, 2009

• 09:00 AM Premarket gainers: AMSC +15%. AIXG +12%. RBS +12%. PQ +11%. LYG +10%. AKAM +10%. MITI +10%. ING +9%. FNM +8%. ABK +8%. CTIC +8%. DB +8%. FITB +7%. FRE +7%. SWSI +7%. BCS +6%. MOT +6%. IRE +6%. ALU +6%. TCK +5%. RCL +5%. RTP +5%. CS +5%. HL +5%. ACGY +5%. MT +5%. GNW +5%. HGSI +5%. FAS +5%. GOLD +5%. LVS +5%. HIG +5%. MGM +4%. CNO +4%. ASML +4%. NCS +4%. LCC +4%. VALE +4%. PG +4%.
  Losers: FSLR -15%. BCRX +4%. FLS -4%. Comment!

• Monday, October 19, 2009

• 09:56 AM Shares of Fannie Mae (FNM -13.7%) and Freddie Mac (FRE -10.5%) are most likely worthless, KBW says in a note this morning, dropping price target to $0 from $1. Firm says the only viable option to recapitalize the pair would be to carve them up into good and bad Fannies and Freddies, with private mortgage lenders owning the better halves, and the lesser halves forced into receivership. 5 Comments

• Thursday, October 8, 2009

• 10:37 AM Fannie Mae (FNM) and Freddie Mac (FRE) remain vulnerable, their regulator says (.pdf). "While a few positive signs of recovery in housing have begun to emerge, we remain concerned and recognize the risk associated with increasing numbers of seriously delinquent loans," FHFA chief Ed DeMarco told the Senate this morning. Comment!

• Wednesday, October 7, 2009

• 07:59 AM Sources say Fannie Mae (FNM) and Freddie Mac (FRE) are readying a program that will help mortgage banks acquire the short-term credit they need to make home loans by committing in advance to buy certain mortgages. GSE commitments to buy loans reduce the risk lenders will be stuck with GSE-reject loans, which must then be resold at huge discounts. 1 Comment

• Monday, October 5, 2009

• 09:00 AM Premarket gainers: VG +21%. BRCD +14%. INO +8%. VIP +7%. MTW +7%. EGI +6%. NMR +6%. HOV +5%. CNO +4%. WFC +4%. COF +4%. FNM +4%.
  Losers: none of note. Comment!