Saturday, Aug 23, 2008
Buffett declares the mortgage giants dead
Telegraph: Fannie Mae and Freddie Mac game over
Billionaire investor Warren Buffett declared that the "game is over" for Fannie Mae and Freddie Mac, as shares in the American mortgage finance houses came under renewed pressure. Mr Buffett, the celebrated "Sage of Omaha," believes that shareholders in the two mortgage companies look set to be wiped out as the pair attempt to raise more capital. "They're looking for help, obviously. And the scale of help is such that I don't think it can come from the private sector," he said during an interview on business television channel CNBC. He went on to claim that the pair "don't have any net worth" and told market-watchers to expect some form of government action soon. A few insurers holding equity in US mortgage giants could also see big losses if the Government takes over Freddie & Fannie.
2 Comments
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1. handle_it said...
**"Most investors are likely to avoid such a scheme, but a strategic investor might be found who could secure the company's finances if Washington provided some form of guarantee."**
A bail-out then :o)
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