If you overlay the natural gas stocks over the coal stocks, it's the identical pattern since last Thursday, only with about half the gains... still some very nice moves for 3 days of work. Since my natural gas stake (3 positions, about 6%) is smaller than coal I am not taking any profits here, but once again just remember this the next time the 'early cycle', 'it will all be fine' folks start clucking.

Let's compare Fannie Mae (FNM) to Cimarex Energy (XEC)

Now, in the most recent period people were so fearful of financials that any news saying they won't be bankrupt was CHEERED - huge writeoffs? Better than expected! Take the stock up!... equity dilution? At least it's not out of business! Take the stock up! - but at some point the longer this goes (and it won't reverse in a quarter or two like many would have you believe) the writing will be on the wall that all these new shares that are flooding the market in financials are going to impair earnings PER share growth for years to come. And as more losses come - not just from housing, but credit cards, auto loans, student loans, personal loans - the more capital that will need to be raised - leading to even more earnings PER share impairment for years to come. The lemmings have not figured that out yet. So multiples on these stocks should degrade - for a very long time. On whatever earnings they do eventually have (because they sure aren't profitable today).

Fannie/Freddie were once about 40% of the entire mortgage origination market, but things have degraded so much in our "transparent, efficient" financial system - they are now accounting for 80% of all mortgages. That should scare you - we are the "most innovative" and "awesome" financial arena in the world - yet the only one source of mortgages people are turning to are the 2 companies with implicit government promises (read: your tax dollars) backing it up in case they implode. Nice. So much for "private enterprise". This is your "tradeoff" for completely ignoring any basic, sensible regulation in the mortgage market for years and letting the "free market" fix things - if not for those 2 agencies that are essentially government entities we'd have no mortgage market right now. And even as these 2 companies report terrible numbers we've had their regulators increase their leverage (another excellent idea by short sighted politicians and cronies) so they can take on more and more and more of the risk (Mar 19: Fannie and Freddie Layered with MORE Risk) - but since the whole mortgage market is frozen, we are forced to do that.