Well I joined the short party. That one day rally sucked. Only problem shorting here is the GBP is showing relative strength even as it falls hard to USD and JPY, probably on account of it being the most oversold.

Target 180.50 after trend low 186.15 and NFP spike low 186.34 on my chart.

Good bounce out of 188. Took 80 pips profit on half position. Stop now at break even (188.90).

Trade closed: stopped out at breakeven on remaining position.

Dear All,

Closed the shorts at 188.50 (+125 PIPs) and waiting for next trade..if 188.50 gives way again, will enter shorts, if 189.50 is broken, will go for a long...

__________________
"The market can stay irrational longer than you can stay solvent" - Keynes

Welcome to Capitalism and free market! Companies succeed and companies fail. Simply because some big company fails should its debt be transferred to taxpayers? Should junk bonds become "good bonds"? What if a thousand small businesses fail because they had debt burden? Would Uncle Sam transfer their debt onto itself? Why should a company get special treatment just because it is BIG? Aren't there thousands of small businesses filing for bankruptcy each year for reasons that are not even as outrageous as underwriting terrible mortgage loans?

Assessing The Damage To Forex Risk Appetite After The Freddie, Fannie Bailout

Something to carefully read and learn. It is filled with good substance and valuable information. Thanks John! Keep up the great work!

Dear All,

Took a long at 189, stop 188 and first target 193, second target 195 and if 195 is taken out, then hard target of 201 (I know...a long shot, but price seems to be forming a short term bottom around 188 area)

Dear DollarBull,

It's like the case of cancer...we would sacrifice a limb to get rid of cancer if we could. Same way, IMHO, US govt is getting rid of wall street stupidities through this takeover (of course, at the cost of tax payers money).

The alternative of deteriorating US economy, bottomless dollar devaluation may not be very pallatable to US population as of now...especially with elections so nearby...as individuals, only thing we can do is to watch our backs and investments...

__________________
"The market can stay irrational longer than you can stay solvent" - Keynes

It is more like cancer being transferred from the hands of corporate thugs to unsuspecting innocent taxpayers.
Just what makes one think that refusal to take over Fannae Mae would result in deteriorating economy and dollar devaluation or taking them over will somehow miraculously solve the macroeconomic problem? Remember I said the economics is a zero-sum game. You can't transfer debt from one person to another and declare victory.

The move to socialize Bear Stearns, Fannae Mae, Freddie Mac is political. The wingnuts would hand over the government to democrats with a monstrous debt that they can't pay without exorbitantly raising the taxes... and now there is an issue to battle in 2012.

It's not so much that the government is just bailing out a failing company. I agree that if a company does bad, it should be allowed to fail. And it's not even just because these companies are big. It's the issue of what these companies do. If they go away, the housing market would just collapse. The government had to help these guys because of what would happen if they didn't. If a small company were to fail, the economy wouldn't suffer in the way it would if Freddie/Fannie failed.

I don't think I explained it very well. The debt has simply got transferred from one hand to another. Please explain how that is going to 'save housing collapse' or explain how 'housing would just collapse' if those companies are sent to bankruptcy. The government has bailed out holders of MBS at the cost of taxpayers. The rich got their asses saved. The poor got slammed, as usual. Those are the only changes.

i will like u to be my analysist, don;t mind paying u, depending on how many pips i make, plz think about it, i plz u for something that cost u notten, contact me thru my mail......fwalkson at yahoo.com.
will be waiting. femi lordson

A failure of Franny would cause a depression. Is that fair to US citizens?

I agree there's little upside in the US economy for years. Less risk = less potential return on investment. But I think stagnation is a better alternative to massive economic fallout. A democracy has a responsibility to serve its citizen's best interests.

A better test of morality is what we do after the crisis is over. Do we learn from our lessons and make reforms? Or do we become complacent in the transfer of more individual risk to the government and ultimately every taxpaying citizen? Do we continue to inflate our way out of deeper and deeper economic holes until one day the pit becomes so deep that foreign investors refuse to lend us any more and the system collapses?

It's interesting; while the rest of the world seeks to imitate Western capitalism and even within that US capitalism, the US is moving towards socialism. Someday, we'll all be the same!

This seems to be a time to decide direction........

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It is easy to decide direction,.... it is still down!

I think we will have to see what that divergence brings in the next few days.... at this minute we seem to have a higher low which could well signal a change in trend..

Hi,
Is it time for this pair moving up?

The government has guaranteed that the $12 trillion worth of home loans owned and insured by Fannie and Freddie won't default. Had those two companies gone under and those loans would have defaulted, who would have been left with the bill? The banks. But now, thanks to the U.S. government, the burden has been spread to the taxpayers. Most people look at this as some awful thing, but each individual taxpayer won't be affected too much. There's enough people in the United States that the load can be spread out. People are just getting all spun up for no reason other than to complain.

Another issue that would arise if Fannie and Freddie were to go under would be who would buy and insure all of the mortgages? Remember that combined those two companies own over half of all mortgages in the U.S. The country is already in a bad situation with the real estate market as it is. Now imagine if Fannie/Freddie weren't there to buy those mortgages. The banks sure couldn't afford to front all of the money to homeowners by themselves. The banking industry is struggling as well. So in the end, things for the banks, and the real estate market, and the economy in general would have been far worse.

So explain to me how the rich got saved and the poor got slammed. The CEO's of the companies got replaced. The tax burden is going to be spread out. The middle/upper class people are the ones paying the most in taxes and they will be able to handle the burden. The share value of the companies has declined drastically, so the investors have lost some money.

Another thing... Under the plan the government set up, they are helping Fannie and Freddie get back on track (which is a good thing). They are making the companies reduce their size and debt. And they have instituted a host of other stipulations to help them out. As the companies start making money again, they are going to be paying back the government, so there again the taxpayers won't be out all that much.

Sounds like a pretty good deal to me.