Fannie and Freddie.

I researched Fannie Mae, Freddie Mac, and Wells Fargo today, and my take is that all of the "accounting changes" that FNM, FRE and WFC have instituted in the last three months, makes their numbers fuzzier than ever before - leading to more uncertainty in the market.

In the case of Freddie Mac, it was the March earnings report - which should have been a negative $2.150 Billion - which was reported as 150 Million [kewl, the 2 Billion was dropped]. In the case of Wells Fargo, they deemed that accounts were delinquent only after 180 days. Maybe I should draw down my HELOC down, and run away with my money, - except, WFC still wins - 'cause they get the bloody house. Why do the banks never give me free money, but they get my tax dollars to bail out people who were speculating on real estate ?

My take is that most of the Alt-A loans were taken out by speculators - sure there were legitimate hardworking poor who stretched themselves to get into some of these loans - but the banks bloody well have an idea of what % was speculative.

ANyway, after a significant amount of research, I determined that FNM and FRE are definitely in the DO NOT BUY NOW category. WFC is a lot fuzzier. I really would like to know what % of their HELOCs are behind by 90 days - especially in CA. If the magic number is below a billion, it is a screaming buy. Below 2 billion, it is a buy. Anything over 3 is a "stay away".....

Bapcha