Jim:   C'mon... tonight, we've got some resolutions to do here... That's right. Tonight, we take the mortgage mess chart off, because the Treasury Department's plan to nationalize Fannie and Freddie is, I think, a big game changer. In my opinion, the plan is brilliant, and I'm not just saying that because, well, I've been calling them to do this plan for months... I'm saying it because it could do some lasting good, if you own a home, or are trying to buy one. Because today, you're better off than you were Friday.

Now, I know a lot of you understand that the government takeover of Fannie is a good thing. The market wouldn't have rallied over 300 points this morning, and closed up 290 points, if it wasn't.

But you don't know why... and you hear the naysayers on TV all day... They're saying, like, this isn't a panacea... it's not a cure-all... Hey, no one ever said it was. It may not be a cure-all, but it's definitely a "cure some"... even a "cure a lot"...

And, not only will I tell you why, I'm also going to give you some stocks you should buy, off the Treasury's long-awaited decision to annihilate Fannie Mae...

A government takeover of Fannie and Freddie should mean more money for more mortgages... at cheaper prices. It means a slowing of the tsunami of foreclosures... and it means - I'm more certain than ever - that your house will stop losing value on June 30th... I now feel even better about my June 30th - 296 more days until your house stabilizes - housing bottom chart.

How does the nationalization of these nare-do-well mortgage lenders lead to the situation I just described?...

Last week, before we knew about the government takeover, our economy was locked in a vicious circle, caused by house price depreciation. So many institutions had better residential real estate, using so much leverage that, if housing prices didn't start recovering, I really worried that we were looking at a financial apocalypse the likes of which we've never seen before... yes, not even in the Great Depression... the worst financial calamity even since 1932... and the falling price of homes was at the absolute heart of the bearish problem.

Since 2005, we've seen double-digit declines in house prices... declines that have made many houses bought since 2005 worth less than their mortgages. That means for a lot of homeowners, it made sense to default, to walk away... to let the bank foreclose on your house... and more foreclosures lead to lower home values which lead to, yes, more foreclosures, and that was the vicious cycle...

Here's how the Treasury department - by taking over Fannie and Freddie - can break that cycle...

Fannie and Freddie, together, are more than half of the bad mortgages in the system... Soon, these mortgages will belong to the Federal Government... Once that happens, anything can be worked out with the troubled homeowners. The Feds can reduce the mortgage payments, they can extend the terms of the mortgage, give you a 30-year fixed, where you used to have a pick and pay... one of these just ridiculously difficult, exotic mortgages...

Because, the government, unlike Fannie and Freddie, can take almost any hit to keep you in your house.

With Fannie and Freddie nationalized, there should be no reason for you to walk away from your home... That should lead to a dramatic reduction in the rate of foreclosures... fewer homes coming into the market... in addition to the enormous reduction in the amount of money people owe on their mortgages.

But that's not all...

By nationalizing Fannie and Freddie, the Treasury has just about guaranteed that mortgage rates for everyone else will go lower!...

These two companies were keeping mortgage rates artificially high, because they were having trouble selling their mortgage-backed paper. People didn't trust the implicit government guarantee... Now the guarantee is, well, they're treasuries...

Given the low interest rates we have in this country, and the freefall in home prices, some homes are - get this, stop trading - actually cheaper now, than they were before the housing bubble started.

The incentives in the recent housing legislation to encourage people to buy homes... the 60% decline in home building two years ago... there's finally an incentive... not just for troubled homeowners to stay in their homes, but for you to buy a home, to come out of the woodwork and actually purchase one.

I was quoted a rate that was a half-point lower than I got on Friday, and them's real dollars if you're buying a house.

This move should bring the credit markets back to life a little more... Again, no cure-all... We won't have to worry about the viability of a Wachovia Corp. (WB) or of a Bank of America (BAC). Let's forget about Wells Fargo (WFC) is in trouble... Maybe even a Washington Mutual (WM), but more on that in a second, especially now that Kerry Killinger's been given the boot... Because we can now cordon off the problem of bad loans where they're manageable, and that should leave these banks in a position where their deposit bases are worth their weight in gold... the spread between what a bank can lend out and what it pays for your deposit is now gigantic.

This, coupled with the glorious decline in energy prices, could eventually get us out of bear territory once and for all, and definitely puts a lot of distance between the July 15th intraday lows that I told you would not be violated, and where we are today.

.  .  .  .  .

Now, what do I think you should buy off of this?...

It's time to go back to Mad Money's "Fortress Four" banks: JPMorgan (JPM*), which I own for my charitable trust... US Bancorp (USB), Wells Fargo (WFC) and Bank of America (BAC)... And, tonight, I'm adding Wachovia Corp. (WB)... It's now the "Fortress Five"... thanks to the leadership of Bob Steele, who I believe will be able to split WB into a good bank and a bad bank, and lead it much higher... Now that the stock was up today a couple of smackers... have a little pullback... knowing this market, you're going to get one.

These stocks have already had major moves, ever since I set the market bottom July 15th, but they're going higher now that Fannie and Freddie are about to be eviscerated...

If this plan plays out like it should, the "Fortress Five" get to make more money... they get to make more loans... and they'll be the ones to benefit when housing bottoms on June 30th of next year... something I am more and more convinced is definite, thanks to the federal takeover of Fannie and Freddie.

Here's the bottom line...