- Mortgage Applications Up as Rates Continue to Decrease
- Wal-Mart Targets Video Games with Latest Price Cuts
- 'Black Swan' Shuns Public Life Because of Bernanke
- Dubai World To Meet with Creditors Next Week
- FHA to Toughen Mortgage Rules in Lenders Crackdown
- Obama to Send More Troops; Seeks Afghanistan Exit
- GM Removes CEO Henderson; Whitacre Is Interim Chief
- Yahoo Expands Integration with Facebook
- Who Were the Biggest Winners And Losers This Year?
- Treasury Assistance Comes at High Price For GM
- Unemployment to Peak at 10.5%: Moody's Economist
- 8 Stocks to Gain on Obama's Afghan Plan: Analysts
- BofA On Proposed Changes In The Housing Bailout Program
- The Future of The Media Landscape
- November Auto Sales Muddle Along
- Busch: What Obama Won't Say Tonight
- Stick with Equities—Avoid Emerging Markets: Laszlo Birinyi
- Pfizer Chomps On A Carrot
MOST SHARED
- Case Closed but Woods Scrutiny Continues
- Kohlberg Kravis Bidding for Morgan Stanley's CICC Stake
- UK Economy Turned, Inflation to Spike: BoE Economist
- Cisco Has 84% of Tandberg, Won't Extend Bid
- Keeping America Great
- Australia Regulator Opposes Caltex-Exxon Deal
- GE, Comcast Complete Deal Over NBC Universal: Source
- Toyota Takes Lead Position in Canada in November
Text Size 
Monday sees a dawn for markets--a false dawn, though.
Investors greeted the weekend development of the US Treasury taking over Fannie Mae and Freddie Mac, seeing it as a sign the housing problem was under control. Stock markets around the world rocket upward.
 |
Lehman Brothers [LEHMQ
Loading...
()
] stock, however, does not participate in the party, losing 13 percent, despite reports company officials hope to cement plans to raise capital and sell off bad debts sometime in the coming week.
But CNBC's Charlie Gasparino reports that Lehman is moving closer to selling its asset management division—including the "crown jewel," Neuberger Berman—in a sign that other efforts to raise capital have not been successful.
Others are also voicing misgivings: "This euphoria might fade, because Fannie and Freddie are not the problem," Christopher Low, chief economist at FTN Financial, tells CNBC. "Their woes are a symptom of a worldwide contraction in credit that may not be cured by the [bailout] decision."
Top investor Jim Rogers denounces the Treasury's moves as "communist" and "insanity":
 |
Elsewhere in the financial industry, Washington Mutual — destined to be bought out by JPMorgan Chase [JPM
Loading...
()
] — ousts Kerry Killinger as its CEO, planning to replace him with Alan Fishman, currently chairman of mortgage broker Meridian Capital Group, according to The Wall Street Journal.
What You Were Reading:
- US Is 'More Communist than China': Jim Rogers
- Lehman Is Moving Closer To Selling Key Business
- What the Fannie Bailout Will and Won't Do
Stocks careen in a way that would become all too familiar to investors through the autumn: The Dow jumps at the opening bell, surging more than 300 points, before pulling back to a more modest mid-200 gain. The S&P 500 and Nasdaq were also higher.
Financials lead the market with sharp gains for those that own a lot of Fannie and Freddie debt, including AIG [AIG
Loading...
()
], Citigroup [C
Loading...
()
] and Bank of America [BAC
Loading...
()
]. Homebuilders also rally.
Fannie Mae [FNM
Loading...
()
] and Freddie Mac [FRE
Loading...
()
] , however, plunge about 89 and 83 percent, respectively—but their debt soars, as investors bet that the bailout will wipe out the companies' stockholders but fully guarantee their bonds. Trading in the stocks is suspended in US pre-market and overseas trading.
Tony Crescenzi of Miller Tabak says the bailout was already priced into the market. Where you should be looking, Crescenzi writes, is at the dollar. The bailout will help keep the U.S. dollar's rally going, he says.
The dollar index hits a one-year high against a basket of currencies following the news.
What the Experts Were Saying:
Jim Rogers, CEO of Rogers Holdings, says the nationalization of Fannie Mae and Freddie Mac shows that the U.S. is "more communist than China" — but it's socialism only for the rich.
Lehman Brothers is moving to sell its prized Neuberger Berman unit. Charlie Gasparino reports.
Paul McCulley, Pimco portfolio manager, offers his insights into the government's bailout of Fannie Mae and Freddie Mac.
- Will the Fed raise rates? Will the dollar continue its slide? CNBC experts weigh in on the year ahead.
- CNBC’s Larry Kudlow offers Tiger Woods some advice on dealing with tabloid scrutiny.
- Goldman Sachs has forbidden employees from gathering in private holiday parties of 12 or more.
- Dictionary.com says that of all words searched for in 2009, a synonym for greed was the top gainer.
- Heavily armed pirates in Somalia have set up a sort of stock exhange to fund their hijackings.
- Since its launch in 1998, Google has become a primary force on the Internet. How much do you know about the company?
Data is a real-time snapshot *Data is delayed at least 15 minutes