I seem almost compelled to add to the echo chamber surrounding Fannie Mae (FNM) and Freddie Mac (FRE) this weekend.

A reader asked if I were expecting a big move in the general market, and if I thought the Financials Sector SPDR (XLF) might be the place to be, and wouldn’t this move kill the dollar? My response was …

Honestly I hadn’t given it much thought, since I’m trading mechanically for many months now.

I think the XLF holds Fannie and Freddie, but I’m not sure how much it holds and how much it would hurt. You can check at SectorSPDR.com.

If you’re worried about XLF in general, you could check the five industry-specific financial ETFs that I list here (see bottom left) and hold the ones that don’t have Fannie or Freddie.

While a bailout would be inflationary in the correct, monetary sense, the thesis appears to be that Europe is weakening and Japan is stagnant, while the U.S. is coming near a bottom, economically speaking. If a bailout of the GSEs is seen as strengthening the rest of the U.S. economy and coaxing a little more activity out of the credit markets, then that thesis will be reinforced and the dollar would be positive.

I’m gonna keep trading my systems. If I were to try and play something Monday - which I won’t - but if I were, I would be careful about the intraday action following gaps up, and try to buy a relative low during the morning. But that’s not my edge, so take it for what it’s worth.

I still haven’t bothered to look at the weights of FNM or FRE in the XLF, because I really don’t care. You can see what my positions are, and the systems I’m tracking, by visiting The Rempel Report; I eat my own cooking and trade according to the systems I create and track.

The news is just noise to me.