These “financial instruments” are not hedges, they are a highly speculative instruments to boost profits to satisfy share holders.

Between their core business tanking with problems with sub prime and Alt-A loans, and speculative derivatives, this will get ugly.

Freddie Mac falls into loss

Jun 14, 2007 08:17 AM
Associated Press

WASHINGTON – Freddie Mac, the nation’s second largest buyer and guarantor of home mortgages, reported a first-quarter loss of $211 million (U.S.), mainly from erosion in the value of financial instruments it uses to hedge against interest rate swings.

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