John Spence
Market Watch
July 12, 2008
Market analyst Jon Najarian at options research firm OptionMonster Inc. in a research note Friday morning said that, although he believes government-sponsored mortgage giants Fannie Mae will continue doing business, “their shares in my opinion are likely worthless.” He said crude-oil prices hitting another record and tough talk from Treasury Secretary Paulson on banks had set the table for a “monster” day in the markets Friday. “There is no reading between the lines necessary here,” Najarian wrote. “I think Freddie and Fannie equity may be toast, which means the government will simply take over both, as [it] can’t let $5 trillion in mortgages vaporize.”
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