FOLLOW THE WEEK ON FACEBOOK
Saving for Houses, Holding on Oil
December 5, 2007
NEWS AT A GLANCE
Fannie Mae stocks up on capital
Home mortgage financier Fannie Mae said it will cut its dividend and sell $7 billion in preferred stock to shore up capital to weather the housing downturn. Fannie Mae owns or guarantees about 20 percent of U.S. home loans. (AP in Yahoo! Finance) The dividend cut—to 35 cents a share, from 50 cents—and stock sale follow similar moves by fellow federally chartered mortgage investor Freddie Mac, which issued $6 billion in stock last week. “There may be more losses,” said David Dreman at Dreman Value Management in Jersey City, but “raising more capital will allow them to go out and start growing again.” (Bloomberg)
OPEC to keep oil supply steady
OPEC members said the cartel has decided against raising oil production, pushing oil prices back above $90 a barrel this morning. (MarketWatch) The organization agreed to meet again in January to reassess the situation. Oil prices are down 11 percent from their recent high as fallout from the U.S. credit crisis has lowered demand forecasts. (Reuters) “Technically and fundamentally they’ve called it right,” said Sucden analyst Michael Davies in London. “There are some real dark clouds over the U.S. and U.K. economies, and they could spread to the rest of the world.” (Bloomberg)
Toy safety database launched
A coalition of public interest groups is launching a Web site today that features a searchable database of safety tests on more than 1,200 toys and other items. The site, healthytoys-dot-org, lists more than 200 items found to contain unsafe levels of lead, representing 17 percent of the products tested. (Detroit Free Press) The groups, led by the Ecology Center in Ann Arbor, Mich., also tested for cadmium, chlorine, arsenic, and mercury. In some of the items, like vinyl lunchboxes, the toxins would be difficult to ingest. Joan Lawrence of the Toy Industry Association said that the groups are presenting “scary information to parents without context.” (The Washington Post)
A Confederate El Dorado
People thought Bob Brewer was crazy, but the $200,000 in gold and silver coins he says he’s found is enough to allow him to pursue his life’s goal—unearthing a $160 million jackpot he believes Jesse James buried in Oklahoma. Brewer’s treasure hunt is a basis for the upcoming sequel to National Treasure, the 2004 Disney hit, and he is a consultant on the new film. Brewer says the gold is tied to his family, the Confederate secret society Knights of the Golden Circle, and the Freemasons. Some historians are skeptical. “It’s my damn story,” Brewer responds, “and if they don’t believe it I’m not gonna worry about it, damn it. Pardon my French.” (Los Angeles Times, free registration required)
Try 4 Risk-Free Issues of The Week magazine.
of The Week magazine.