Released on: September 6, 2008, 3:49 am

Press Release Author: Richard Drake

Industry: Financial

Press Release Summary: Cornerstone Worldwide cited worries over the bailout of
mortgage giants Freddie Mac and Fannie Mae as the catalyst for increasing demand for
U.S. Treasury debt. Prices rose for a third straight session, taking benchmark
yields to one-month lows as weaker stocks ignited safe-haven bidding for lower-risk
government debt.

An unnamed source with knowledge of research at Cornerstone Worldwide added that
falling energy prices also boosted bonds by easing expectations the Federal Reserve
will eventually have to raise interest rates to combat inflation.

Mounting concerns about the health of financial companies encourages the
flight-to-quality bid for Treasurys.

The benchmark 10-year Treasury was trading 8/32 higher in price for a yield of 3.82
percent -- the lowest since July 16 -- from 3.85 percent late Friday. Two-year notes
were 2/32 higher for a yield of 2.36 percent from 2.40 percent.

The National Association of Home Builders\' gauge of homebuilder optimism for August
was the only significant data scheduled for release on Monday.

The highlight event this week is expected to be on Friday, when US Federal Reserve
Chairman Ben Bernanke speaks on financial stability as part of a convention in
Jackson Hole, Wyo.

Cornerstone Worldwide said stocks were impacted on Monday by mounting fears over the
potential for more losses from the mortgage crisis. Shares of U.S. home finance
giants Fannie Mae and Freddie Mac were trading 20 percent lower in price after
reports that the U.S. Treasury is increasingly likely to recapitalize the two
companies, a move that would dilute the value of stock holdings. Cornerstone
Worldwide were rumored to be buying stock in both companies in preparation for a
rally but no confirmation was forthcoming.


Press Release Body: Cornerstone Worldwide cited worries over the bailout of mortgage
giants Freddie Mac and Fannie Mae as the catalyst for increasing demand for U.S.
Treasury debt. Prices rose for a third straight session, taking benchmark yields to
one-month lows as weaker stocks ignited safe-haven bidding for lower-risk government
debt.

An unnamed source with knowledge of research at Cornerstone Worldwide added that
falling energy prices also boosted bonds by easing expectations the Federal Reserve
will eventually have to raise interest rates to combat inflation.

Mounting concerns about the health of financial companies encourages the
flight-to-quality bid for Treasurys.

The benchmark 10-year Treasury was trading 8/32 higher in price for a yield of 3.82
percent -- the lowest since July 16 -- from 3.85 percent late Friday. Two-year notes
were 2/32 higher for a yield of 2.36 percent from 2.40 percent.

The National Association of Home Builders\' gauge of homebuilder optimism for August
was the only significant data scheduled for release on Monday.

The highlight event this week is expected to be on Friday, when US Federal Reserve
Chairman Ben Bernanke speaks on financial stability as part of a convention in
Jackson Hole, Wyo.

Cornerstone Worldwide said stocks were impacted on Monday by mounting fears over the
potential for more losses from the mortgage crisis. Shares of U.S. home finance
giants Fannie Mae and Freddie Mac were trading 20 percent lower in price after
reports that the U.S. Treasury is increasingly likely to recapitalize the two
companies, a move that would dilute the value of stock holdings. Cornerstone
Worldwide were rumored to be buying stock in both companies in preparation for a
rally but no confirmation was forthcoming.


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