Fannie Mae and Freddie Mac to Buy Rick's Cabaret and than Ning.com!

Posted by Howard
on July 13th, 2008

I got the following e-mail from my friend Will G, a friend and successful commercial developer in California, regarding Freddie and Fannie:

$5.2 Trillion. This is the face value of the amount of loans owned and/or guaranteed by Fannie Mae and Freddie Mac together. I did some off the cuff calculations. If we assume that 5% of these mortgages will go into foreclosure (and I would guess that is pretty conservative given the current and projected real estate situation in the U.S.) and if we assume that after the expenses incurred in maintaining the REO (Real Estate Owned), and in the sale of the REO, then probably the average recovery will be about 75% (that is probably way high, but to be conservative we will go with that number) the combined losses over the next 3 years or so are likely, at minimum, to be over $62 Billion. Fannie and Freddie have nowhere near that capital, and it is doubtful if they can raise sufficient capital. In other words the value of their common stock will almost certainly go to zero. So, taxpayers are likely to own Fannie and Freddie.

So now that WE own Fannie and Freddie I say that some of my big shot hedge fund friends turn Fannie and Freddie into the ultimate porn site. How about:

FastFreddieandFannie.com – ‘Porn So Safe, Even the US Government is LONG it’.

To get it rolling we buy RICK’s Cabaret and Social networking porn site Ning.com

Thoughts?

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