Is Fannie Mae Beyond Economical Repair?

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When will housing hit bottom? When the news wires and newspapers are no longer full of developments like these:

--From CNBC: ‘Fannie Mae said after markets closed Tuesday that it will sell $7 billion of preferred stock and cut its dividend 30 percent to shore up its capital position through 2008.’ Wait, you say, didn’t Fannie just issue a bunch of preferred stock? No, that was Freddie Mac, which sold $6 billion in preferred stock last month.

--From The Motley Fool: Lennar, the homebuilder, sold properties -- mainly undeveloped lots -- it had valued nine weeks ago at $1.3 billion for $525 million. The Fool: ‘... If the powers that be at Lennar (who are among the most capable in the industry) had even briefly thought that our nation’s housing market was approaching that elusive ‘bottom,’ there’s absolutely no way they’d have dumped properties in such volume at just $0.40 on the dollar.’

--From the LATimes, signs of weakness in LA’s commercial real estate market: ‘The global credit crunch that took hold of financial markets in the summer is now taking the steam out of commercial real estate.’

--From Bloomberg: ‘H&R Block ... shut its subprime home-lending unit and cut 620 jobs after a sale to Cerberus Capital Management LP unraveled.’

Your thoughts? Comments? Insights? Email story tips to peter.viles@latimes.com.
Hat tip: Several of you, you know who you are, emailed or commented about the Lennar fire sale. Thanks.