Hedgie Tepper on pace to make $2.5 billion this year (WSJ) The moral hazard trade has a new face. Tepper bet big that government would rescue bank shareholders and creditors. He was right. Can we blame him? He didn’t make the rules; he just played the game better than the rest once they were made.
Fed repeats “exceptionally low” for “an extended period” (Fed statement) The Fed maintains that it isn’t raising rates for the foreseeable future, but repeated that it plans to end MBS asset purchases by April next year. Too bad we can’t get a surprise rate hike in order to chase risk back out of credit markets…
Al Yoon reporting on the ever-expanding bailout of Fannie Mae…. (Reuters)
Fannie Mae … on Thursday reported a $14.8 billion quarterly net loss …. [I]ts regulator requested $10.7 billion from the Treasury to erase a deficit in its net worth, bringing total draws under a senior preferred stock purchase program to $45.9 billion.