Fannie Mae Becomes Cash Cow¬†(CNBC)
Mortgage giant Fannie Mae reported a record net income of just more than $58 billion for the first quarter, causing its share price to surge over 500 percent during the last three months. But do not expect Congress to take Fannie Mae out of government conservatorship and recapitalize it anytime soon. “This is a Congress that needs and wants a lot of money. Why would they ever give up this revenue stream, especially if it’s going to speculative bets on Wall Street?” asked Ed Mills of FBR Capital Markets.
The dollar fell against the euro today, as St. Louis Federal Reserve President James Bullard said the Fed should continue quantitative easing, which would affect the pace of bond buying. This policy raises concern among investors about the valuation of the dollar. “The fact that he supports continued easing is seen as a negative for the dollar because Bullard is one of the more hawkish members of the Fed’s voting committee,‚?Ě said Eric Viloria, senior currency strategist at Forex.com.
Stocks rose today and sent benchmark indexes to new highs, after Federal Reserve Bank of St. Louis President James Bullard said the central bank should continue buying bonds to boost anemic economic growth. Investors apparently see no reason for stock growth to cease anytime soon. ‚??We have a long stretch now with no significant decline and I think that‚??s going to continue until there is some significant concern about the Fed stopping,‚?Ě said Jason Thomas, chief investment officer of Los Angeles-based Aspiriant.
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