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Fannie & Freddie Bailout? - Fast Money Recap (9/5/08)

Government giving capital to Freddie and Fannie caused a rally in both those stocks just two months a go. Now were told that since they are now going to help them, its bad for the stock? What?! If its good for the stock 2 months ago, why is it bad now? Based on this bs, Id buy both of them after this sell off. Sounds like a case of classic Main stream media bs to me. SO which is it? How can the government add capital to FRE and FNM, and at the same time whipe out stock holders? You would have to either dilute shares, or do something that would be bad for the company. How is government backstopping their loans bad for their stock price? If you knew your company could take chances, and take losses, and the government would just give you money, wouldnt your stock go up in value, not down? If a bankrupcy happened, that is what causes a stock price to go to 0. They are not declaring bankruptcy, nor is the government taking over the company, just replacing the CEO's. This move in a company losing money is always market positive. The stock price of FRE went from 5.10 to 5.75 upon initial announcement(correct response to this news). Only after did it drop to 3.80, before going back to 4.04. The latter was the manipulation, using rumor and speculation that the stockholders will be ruined(CNBC said that, so you know its bs), and that is irresponsible journalism, and that caused the price to drop. No facts caused it to drop. Someone should sue CNBC for that. Honest judge would rule that to speculate like that correlated with an illogical drop in stock price would prove manipulation.

Stay Clear of Traditional Asset Classes

Thank you for your response Mike, I will withdraw the naive comment, and replace it with hopefull, I apologize. You are very informed about the details, true. As for the ETF, I mean its bad for , hey I need my gold, like NOW, situation. And if you buy and hold, over time, you will not lose. So its a win win. And yes, every once held by citizens, is one less ounce the central banks control you. Agree with it or not, thats up to you. If everyone bought 1000 worth of gold in the world who could afford it, you do the math on supply. Every person in the world should hold at least 20% of their savings in physical gold or silver. Its a no brainer these days.

Stay Clear of Traditional Asset Classes

O, and how dare you write an article like that an not recommend physical gold or silver. Its the only way to insure your product when you need it. You can always sell it if you want too. If you want to play with GLD, then your limiting your profits. Same with SLV, waste of money. And plus, by buying physical you actually take a limited resource out of the market. If everyoen bought gold and silver, instead of jerked off on the etfs, gold would be im guessing at least 1-10 percent higher? That would compound over time, plus if we buy it, it would force all the central banks to buy it, driving up the price even more, and ever time gold adds a dollar, it sticks a knife in every elitist wallet, and im not talking Rupert Murdock and Warren Buffet, those guys arent rich, trust me. Im talking about the real elite, the ones that have invisible income. I wont name names, but go through the worlds richest people list, and you will notice an alarming lack of who you would think would be there. They are nowhere, because they dont want you to know how much of your money(its trillions folks, yes there are trillionarie familes out there).

Stay Clear of Traditional Asset Classes

Mike, you are very naive to think healthcare can be solved by eliminating lobbyists. They go go behind closed doors then, big deal. You have to root out the problem in healthcare. The problem is, we need it too much. Heres a thinker. If you attacked the problem from the reason we all spend too much money at the doctor, we can keep the current system, and just use it 50-80 percent less. I know, you cant make people eat healthy, but you can make companies responsible for the crap they feed us. If they want high frutose corn sryup to be legal, hydrogentated oils, artifical sweeteners, etc... then they need to convince me that it is food. Food gives life, and energy. If its not food, then its taxed, like crazy. That money goes to health care. You would see a huge shift to real products made with actual food. Problem solved. Educate people on why they are given pills, what antibiodics really are, and that doctors now are nothing more than salesmen for drug companies. If you break your arm, fine. O, and cancer, curable by eating apple and peach seeds. Vitamin b17 is why we get cancer. We dont get it anymore. The lowest rate of cancer on the planet is in an area of Nepal where they actually use peach seeds as there system of currency. Through making companies responsible for the products they produce, and educating americans on the realities of health, will improve things way more than eliminating lobbyists ever will. Everything you wrote in your article I agree with. Your right on, but your a little too opptimistic, i know, you opptomistic, lol.

Stay Clear of Traditional Asset Classes

Magman, your wrong, and he is completely right. He said oil would continue to go up, and gold and gold stocks are perfect to buy soon, if not now, if the Comex raiders are going to use the sell in may and go away as a chance to skyrocket gold while everyone isnt looking, putting the 850 price buying opportunity at a very quick chance. Everything he lists is a winner. The stock market is a shell game, and its based on very little reality in most cases. For example, $45 a share for Merril Lynch? Why would I give $45 of my hard earned dollars for one share of a company that cant make money. KB Homes went up today. LOL LOL People actually think that their going to be building homes and selling them this year? That stock should be $1. All bank stocks should be priced between $.10 cents and $2, if everyone was informed correctly.