San Diego Housing Bubble News and Analysis

Just trying to keep this thread high up.

Too risky for my blood. Unlike other company stocks the problem with evaluating Fannie Mae is that the ultimate fate of it will likely be dictated by Government intervention, not necessarily fundamentals.

Recently the Gov't is backstopping and potentially buying the stock providing support. But who knows what happens 6 months or a year from now, with a new Administration.

For example, instead of backstopping the GSE's here's what some folks think should be the solution:

"They should have wiped out the shareholders, nationalized the institutions with legislation that they are to be reconstituted -- with necessary taxpayer support to make them financially viable -- as five or 10 individual privately held units," which the government would eventually auction off to private investors, he said.

My observation is that the financial stocks are still to highly unpredictable to be in a position for a long time either short or long at this point. So much swings at the whim of hearsay and rumors.
Just take for example at BAC and others. Within two months we've seen a movement from the mid thirties all the way down to $18 and all the way back up to the thirties where it stands right now.

This will probably continue. Complicated by this is the issue that it seems like the Fed likes to willy nillie step in and out when it feels like it needs to. For instance, the temporary restriction on naked short selling imposed only on financial stocks and the subsequent expiration of that rule (yesterday).
If that's not disturbing to one, I don't know what is. Too many people have their hand in the cookie jar.

Disclaimer, I'm generally gambling (and yes I consider this gambling) on BAC and C by having a few shares long-long, and in addition been in and out of BAC and C when there trying to time some of the swings by when there is a $1-$2 difference in price, coupled with writing some in-the-money covered calls hoping they will expire worthless. Aside from having a nightmare tax reporting situation next year (currently at 54+ trades on BAC alone), I'm not sure if this "experiment" is really going to be better than sticking things in a index fund for the long run. If it does turn out to work for me, it would definitely be all luck and no skill.

Correction...I lied. Make that 47 times not including covered calls on BAC...Lol, my head is spinning and it's going to be a bad hangover next tax time.
8/14/2008 Sell BAC BANK OF AMERICA CORP [Details] $29.82
8/13/2008 Buy BAC BANK OF AMERICA CORP [Details] $28.88
8/13/2008 Buy BAC BANK OF AMERICA CORP [Details] $29.76
8/12/2008 Buy BAC BANK OF AMERICA CORP [Details] $31.30
8/11/2008 Sell BAC BANK OF AMERICA CORP [Details] $33.38
8/8/2008 Buy BAC BANK OF AMERICA CORP [Details] $31.92
8/8/2008 Buy BAC BANK OF AMERICA CORP [Details] $32.00
7/29/2008 Sell BAC BANK OF AMERICA CORP [Details] $31.49
7/25/2008 Buy BAC BANK OF AMERICA CORP [Details] $30.05
7/25/2008 Buy BAC BANK OF AMERICA CORP [Details] $30.05
7/23/2008 Sell BAC BANK OF AMERICA CORP [Details] $33.50
7/23/2008 Buy BAC BANK OF AMERICA CORP [Details] $33.97
7/21/2008 Sell BAC BANK OF AMERICA CORP [Details] $30.14
7/17/2008 Sell BAC BANK OF AMERICA CORP [Details] $24.78
7/16/2008 Sell BAC BANK OF AMERICA CORP [Details] $19.90
7/15/2008 Buy BAC BANK OF AMERICA CORP [Details] $18.84
7/15/2008 Sell BAC BANK OF AMERICA CORP [Details] $20.00
7/15/2008 Buy BAC BANK OF AMERICA CORP [Details] $18.77
7/8/2008 Sell BAC BANK OF AMERICA CORP [Details] $21.57
7/8/2008 Sell BAC BANK OF AMERICA CORP [Details] $21.57
7/7/2008 Buy BAC BANK OF AMERICA CORP [Details] $21.30
7/7/2008 Buy BAC BANK OF AMERICA CORP [Details] $21.30
7/2/2008 Buy BAC BANK OF AMERICA CORP [Details] $22.77
6/30/2008 Buy BAC BANK OF AMERICA CORP
type: REINVEST DIVIDEND [Details] $24.36
6/27/2008 BAC BANK OF AMERICA CORP
type: QUALIFIED DIV
6/19/2008 Buy BAC BANK OF AMERICA CORP [Details] $27.91
6/4/2008 Buy BAC BANK OF AMERICA CORP [Details] $32.38
6/2/2008 Buy BAC BANK OF AMERICA CORP [Details] $33.57
5/29/2008 Sell BAC BANK OF AMERICA CORP [Details] $34.64
5/28/2008 Buy BAC BANK OF AMERICA CORP [Details] $33.65
5/21/2008 Buy BAC BANK OF AMERICA CORP [Details] $35.30
5/16/2008 Buy BAC BANK OF AMERICA CORP [Details] $36.19
5/9/2008 Buy BAC BANK OF AMERICA CORP [Details] $37.27
5/1/2008 Sell BAC BANK OF AMERICA CORP [Details] $39.33
4/14/2008 Buy BAC BANK OF AMERICA CORP [Details] $35.80
3/31/2008 Buy BAC BANK OF AMERICA CORP
type: REINVEST DIVIDEND [Details] $38.49
3/28/2008 BAC BANK OF AMERICA CORP
type: QUALIFIED DIV
3/24/2008 Sell BAC BANK OF AMERICA CORP [Details] $42.25
3/18/2008 Sell BAC BANK OF AMERICA CORP [Details] $37.59
3/10/2008 Buy BAC BANK OF AMERICA CORP [Details] $35.82
3/6/2008 Buy BAC BANK OF AMERICA CORP [Details] $36.51
3/3/2008 Buy BAC BANK OF AMERICA CORP [Details] $38.84
2/29/2008 Buy BAC BANK OF AMERICA CORP [Details] $40.42

08/11/2008 Sell to Open 2.0000 BACIF CALL BANK OF AMERICA COR$30 EXP 09/20/08 [Details] $4.50000
08/11/2008 Sell to Open 2.0000 BACIF CALL BANK OF AMERICA COR$30 EXP 09/20/08 [Details] $4.30000
08/11/2008 Sell to Open 2.0000 BACIF CALL BANK OF AMERICA COR$30 EXP 09/20/08 [Details] $3.45000
08/08/2008 Sell to Open 2.0000 BACIF CALL BANK OF AMERICA COR$30 EXP
07/23/2008 Sell to Open 2.0000 CALL BANK OF AMERICA COR$30 EXP 08/16/08 [Details] $4.05000
07/23/2008 Sell to Open 2.0000 CALL BANK OF AMERICA COR$30 EXP 08/16/08 [Details] $3.20000
07/18/2008 Sell to Open 2.0000 CALL BANK OF AMERICA COR$30 EXP 08/16/08 [Details] $1.35000
07/18/2008 Sell to Open 2.0000 CALL BANK OF AMERICA COR$30 EXP 08/16/08 [Details] $1.35000
07/18/2008 Sell to Open 2.0000 CALL BANK OF AMERICA COR$30 EXP 08/16/08 [Details] $1.35000

Their accounting includes massive fraud and 200:1 leverage and the government may have to step in to backstop. This company is an eventual ZERO and the only buying I'd do is in leap puts. There is no way that shareholder equity survives in the long term.

I agree with capeman and others, something stinks in denmark. Avoid it, too many variables, shareholders are of little concern to the gov't and they will be the first to be wiped out when it reorganizes. A real bank would wipe out the fb's before the shareholders but not this one. They recently released statements to the press that they would dump their inventory, I fear the math will get ugly when they do. They may also be forced to take losses to appease the politicos even if it means losing even more money.

Thanks for posting. This is a first.. no contrarian posts on a Pigg thread.
A friend of mine is considering buying.He ususally makes smart moves. Pretty much has made up his mind. He thinks he will get in later in the year,catching a dip on selling for taking 2008 losses. He obviously does not believe FNM will go bellyup. He is looking at at least a two to three year hold and maybe longer.

Rustico, I have been watching FNM and FRE closely. There will be many opportunities to make money from it. they will remanin very volatile and you need to be agile with strict stop-loss. Blood is in the street. there may be more coming. But that's when you can make some easy money.

FNM is down about 17% today. Crikey!

Closed today down 22%.

Good call on the risk factor FSD.LOL. Volatility ...check. My buddy just sees it as a better entry point and is more motivated to get his order in. We'll see. I have no skin in the game.

Rus, hope your buddy has balls o' steel. If so, he'll probably make a killing. Personally I'm already half-a-nut short, so I think I'll stay away from this one.

Looks like the GSEs are heading for the dollar menu.

What would the pink sheet symbols be for Fannie and Freddie?

http://www.ft.com/cms/s/0/01a7f9b2-6d86-...

This is a good write-up.

Looks bad for fixed rate mortgage rates though.

If you liked Fannie at $8, do you love it under $5?

Oh, what the hell. It's only money, right?

>>>>>>>>08/20/2008 Buy FNM FANNIE MAE $5.00000 [Details]

Who needs an audi S5 anyway :(

A fool is soon to be parted with his money.

Yeah, instead of buying lottery tickets this year I jumped in also. Couldn't resist.

Buy 200 FNM Market 4.8599 12:55:32 08/20/08

Note : bought in my taxable account so that I can at least take the loss if it goes to zero.

Great, between you and me, we're going to sink the stock :) The bright side, is I'll have a capital loss carryover for years to come.

'I'll have a capital loss carry over for years to come'

Just to bring this link back to the house market for a second, you might like to note that Merrill Lynch decided to book all their mortgaged backed securities in their London operation. Result, they now have tax losses of

$29bn

They may start paying tax again to the UK government when our time catches up with Star Treck time!

Stops?

The news of Freddie's little sitdown with the Treasury this afternoon is a bit cautionary, IMO. I can't pull the trigger, and I traded ETFC earlier this year.

FormerSanDiegan, I don't know about you, but I've dumped 70% of my FNM position today at $6.46. I'll take my 29.2% gain over 7 days on part of my initial position. Good luck to you man, you've got bigger balls than me.

I've been too busy at work to even think about it much. Today seems like it would have been a nice day to have cashed out and play with the house's money. Oh well, my position is pretty small. It's more for entertainment purposes than anything.

I'm out of FNM. It was a nice little rally from 4.85 to 7. Too bad I haven;t enough guts to put significant dough on the line. But at least it beats my last trip to Vegas.

FLU & FSD, I am glad it worked out for both of you!

Good for you!. I'm sold most of the rest of my position at 7.15. But, I'm still holding out 5% left to see if we can see $10-15. :) (Greedy bastard, huh?)

Starting to buy CVX. (Yes, I know. Too much gambling on my part).

Ok FSD,

I've completely exited the remaining portion of my FNM after hours at 5.41...

Looks like the s**** has hit the fan folks.

http://biz.yahoo.com/ap/080905/mortgage_...

Good job getting out! Common is a ZERO on Monday!

common is probably a buck but not much more.

Not a bad trade on a worthless stock. 36% net after a two weeks (sold half at 6.39, the rest at 7.18). I guess it's better to be lucky than good.