Freddie Mac (FRE)

Govt Backup, Negatives are already build in stock, now it is time to go up by 50%

Investors know that this company is a winner, with their mortgage default rate of less than 1% profits are in its future. Most of the Derivitive nightmare is behind us except for that which AIG has been successfully cleaning up. New lending rules are also in place and future loans are being conducted to a higher standard and with the backing of Uncle Sam.

Some people are fearing inflation vs. fixed mortgages, but the reality is and if we are to learn from the Turkish model, all inflation does is send volumes of money in the stock market. History also shows (1970's)that Interest rates will also climb to compensate for any negative effects.

This stock also took a severe hit causing it to be grossly oversold. Most of that hit came from the practice of naked short selling that led to a panic of overselling on both Freddie and Fannie. My advice is buy it up now and hang on because in about six months you will have more than tripled your money, especially if you got in at under $2.00.

Its all about confidence_____Obama stimulus will put people back to work_____Work instills confidence

Freddie & Fannie already entered its rising phase from the lowest trough. Although both mortgage gaints have a -ve Net Equity, their mortgage business covered a large number of metropolitan cities in U.S. Both stocks have a very high value (>US900B) of total assets, an increase in asset value could overcome the problem of neg. net equity once US housing problems improved.

The washington politics will not let there ugly step children fail they will keep pumping money into these companies until they recover.