Four fund companies may have lost $4 billion in Freddie Mac and Fannie Mae

[flashl]

Four fund companies may have lost $4 billion in Freddie Mac (FRE) and Fannie Mae (FNM)

Douglas A. McIntyre is an editor at 247wallst.com.

Someone lost a lost of money as the prices of Fannie Mae (NYSE: FNM) and Freddie Mac (NYSE: FRE) hit multiyear lows on news that several analysts believed the federal government would have to take the two companies over. In all likelihood, the move would wipe out common shareholder.

Famous stock-picker Bill Miller of Legg Mason (NYSE: LM) may have been one of the casualties. According to work done by Reuters, Legg Mason, Capital Group, AllianceBerstein (NYSE: AB) and Fidelity lost a total of $4 billion on the mortgage company stocks over the course of last week's trading.

While all fund companies may have been hit equally, which no one can know exactly at this point, Miller's reputation as a leading fund manager is being devastated. After years as one of the most successful portfolio managers in the country, his fund has underperformed the S&P for two years.

It looks like Miller is going for a third.

Blogging Stocks

[LiberalEsto]

1. Oh, swell

My husband's retirement pension from Fannie Mae is handled by Fidelity.

[soothsayer]

2. um, you only lose money on stocks when you sell. did they sell? if so, why?

if not, who cares? they should hold the stocks long term. and pray!

[sendero]

3. Anybody..

.. stupid enough to hold Fannie Mae or Freddie Mac "long term" is going to wind up with stock worth $0.00.

The Federal govt will bail them out but not the shareholders, you can bet on that.