Added a little more to my short position.  I still can't understand why this bounced the way it did today.  Was it the S&P report?  If so, I'm very comfortable with this short, because--at least from what I've seen of it--it said that the subprime markdowns will soon be over.

So what?  FNM doesn't deal with subprime mortgages to my knowledge.  What there is to be worried about--and what S&P remained mute on--is the bread and butter of Fannie's business, prime, conforming loans.  And the problems have only begun there.