Thursday, May 15, 2008
Freddie Mac's losses--worse than they look
Charles Duhigg has a good explanation in today's New York Times. The really scary part is that the company's capital has been reduced to about $16 billion, which puts it at a 50-to-one leverage ratio. They need to raise capital now--I am guessing they will find their common stock offering to be expensive for their current shareholders.