The bond market super-seer tells the LAT's Tom Petruno that the government rescue plan for Fannie Mae and Freddie Mac is a "positive step." Gross has been pushing for the feds to get more involved, though he’s not exactly a disinterested observer. He is chief investment officer of OC-based Pimco, which happens to own a ton of mortgage-backed bonds from both Freddie and Fannie. The government's intervention presumably will protect that investment. Here's more from Money & Company:

For the financial system, "The Category 4 hurricane has been downgraded to a tropical storm," he said. He predicts that mortgage rates will fall this week as the rates that Fannie and Freddie pay to borrow money begin to decline. He also expects the stock market overall to rally Monday. And Gross has revised his estimate of how much more of a decline is in store for home prices. He had been expecting average home prices nationwide to fall an additional 10% to 15%. With Fannie and Freddie preserved, he sees prices bottoming after a further decline of 5% to 10%. But that isn’t his forecast for California, where market conditions are much worse and likely to stay that way, he said.