So what caused today's NLY slide after such a strong day yesterday? Was it the Chimera IPO and NLY's involvement or was it more? Is it Fannie Mae/Freddie Mac contagion spreading to anything and everything real estate related without regard to merit?
I'd say the slide relates directly to the release of the minutes from the Fed meeting of last month. The interest rate approved at that meeting was described as a "close call" in the minutes. And there didn't seem to be much enthusiasm for future rate cuts -- which is something that the market -- particularly holders of NLY stock -- have all but factored in. NLY makes its money when the price of short term money falls. The perception that it might not fall as quickly as everyone had hoped hurts the stock price.
FWIW, I've grown to truly hate the Fed. They got us here, and now they want to wash their hands of the matter?. They want to protect the USD?. Where were they when they got the funds rate down to 1.00%? Now they want to punish the miscreants who borrowed and lent shamelessly? There's plenty of blame to go around, not enough of it directed at where it ought to go, IMHO.