[PSH]

Phil:

We really are not that far apart. Yes, in theory i agree that corporations that make mistakes and in this case take on too much risk and leverage without thinking about the consequences should be allowed to go under...
However, as evidenced by the engineered takeovers of Bear Stearns and Countrywide Credit by the government there is a maze of connections within the financial system that is scaring many to allow them to go under. As was pointed out in the earlier post the equity holders are pretty much all wiped out as if the company went bankrupt. However, in the case of Bear Stearns and Lehman or Merrill Lynch or whomever there is too much counter-party risk to allow these investment banks/brokers to go under without someone coming in and swooping them up. Yes, i agree FNM had enough capital today to get to the end of the year and FRE was questionable. The ability to access additional capital in the markets has become questinable given their share price and risks. The government almost had to do what they did just to keep the financial system from taking a huge hit given the large amounts of paper outstanding. That is just my take and opinion. I understand your position....

PSH