Have you wondered about the timing of the Fannie Mae/Freddie Mac bail out? I think I may have found a clue today. After months of being on the watch list, Washington Mutual is finally sounding its death knell.
Washington Mutual today slammed the door shut on an empty barn, saying in effect that its insiders were out and its game was up.
Washington Mutual Inc., the biggest U.S. savings and loan, removed Kerry Killinger as chief executive officer after he failed to halt losses tied to home mortgages that already total $6.3 billion.
It is probably not a coincidence that Killinger’s resignation came the same day as the heads of Fannie Mae and Freddie Mac did. Nor should the resignation be confused as an appropriate ouster by justifiably outraged investors. It seems far more consistent with Wall Street’s ways that departure, coming as it is the very end of the subprime, kamikazei run simply means management has drained Wa Mu blood dry and Killinger will be spared the indignities of the consequences of his actions. Conservatorship.
from http://bankimplode.com/...
See also http://www.bloomberg.com/...
So there's a party going on today, lots of money to be made in short term trades, but don't expect the market to really go anywhere. The bail out is clearly a smoke screen. Don't fall for it folks.
As Stranded Wind said here:
It's going to be a shitstorm when a big one lets go, like WaMu or Wachovia - Fannie and Freddie go on the tax payer's tit and the FDIC right behind them.
It's way past personalities - we're into a time when one little thing somewhere that nobody thought of can snowball into a real mess.