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I would like for someone to explain to me what is the downside of FRE below $2.00? I admit to being inexperienced in investment and I would like some guidance here.

It would seem that there is no way that the government will let Freddie or Fannie completely fail. While clearly the bad mortgages on the books will hinder Freddie's profitability in the near term surely this stock will rise when we begin to emerge from the weakness caused by the housing bubble.

With virtually no chance of going out of business and a stock price currently below $1 it appears to me (a noob) that it is only a matter of time before this stock is back to the $4-8 range. Is there a risk that the shares will be completely devalued? Help me understand how this is a bad buy currently at $0.92.

Any input is sincerely appreciated. Educate me please.
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