I voted for Sherrod Brown... and now I am convinced he is the right man for the job. While I may disagree on some of his political thoughts, the bottom line is he is voting with his conscience. Many of us may second guess our political leaders... I do have a sense of satisfaction that at the end of the day, this man truly looks out for his constituents. What more can you ask of a man than to do that? This is the second letter I have received from Sherrod Brown. I have yet to hear from LaTourette or Voinovich. Mu guess is he is the type of guy who will be willing to meet us when we visit D.C. next Spring! Readers will be particularly interested in the investment scenario our esteemed Senator envisions for Freddie and Fannie Mae.*
Dear Mr. Davis:
Thank you for contacting me regarding provisions within the recent housing bill that will reform the regulation of Fannie Mae and Freddie Mac.
I understand your concern that the hard work of many home owners who made responsible loan decisions should not be overlooked by Congress. However, it is important to recognize the threat that the foreclosure crisis poses to our nation as a whole, and especially to Ohio.
I share you concern about the fact that the federal government has made clear that it will provide a backstop to Fannie and Freddie should the need arise. The authority provided to the Treasury Secretary is temporary, and I hope it will not be used. If it ever is used I suspect that the companies and shareholders, who have seen the stock price drop by about 75 percent over the past year, will not have much left.*
But the collapse of Fannie Mae and Freddie Mac, which own or guarantee around half of the nation's mortgage debt, would cause a serious blow to our economy. Congress cannot stand by and allow this to happen. This legislation is an important step in addressing this crisis that is affecting millions of American families each day.
While you and I may disagree on this issue, I value your input and hope you will continue to share your thoughts with me. Thank you again for writing.
Wall Street action on Thursday...a sell-off of sorts suggests one of two (mega)trends.
1. Wall Street got a taste of reality with dismal jobs numbers, bad news from Wal- Mart, and outright Richter Scale tremors from the financials with AIG leading the way. Ax-man needs a little more encouragement from GNW... and it will be cigars for all on his trip back to Cleveland. The consumer is on life-support. We will see more insight to consumer sentiment next week.
2. Short sellers are destroying a great rally, and there is a greater need to look for more New Deal era fixes for this market.
Economic Calendar for Next Week... A huge week for consumer sentiment.
August 11 - August 15, 2008
Monday, August 11, 2008
Tuesday, August 12, 2008
Wednesday, August 13, 2008
Thursday, August 14, 2008
Friday, August 15, 2008
Consider Shorts on...