Worries Lurk Behind Europe's Relief Rally

Experts say the Fed's move on Fannie and Freddie does little to address the woes of Old World banks, which have written down billions
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European markets breathed a sigh of relief on Sept. 8 after the U.S. government finally took over beleaguered mortgage lenders Fannie Mae (FNM) and Freddie Mac (FRE). The prospect of a combined $200 billion capital injection in the firms helped to bolster investor confidence, leading markets across the region to soar, on the back of surging financial-services stocks.

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