Market analyst Jon Najarian at options research firm OptionMonster Inc. in a research note Friday morning said that, although he believes government-sponsored mortgage giants Fannie Mae and Freddie Mac will continue doing business, “their shares in my opinion are likely worthless,” according to an entry on MarketWatch. The New York Times reports today that the government is thinking of taking over the two companies.

So what does this all mean? Will Fannie and Freddie go under? It’s highly unlikely – Citing unnamed people who have been briefed on the government’s plan, the Times reported that the companies would be placed in a conservatorship, under which the shares of Fannie and Freddie would be worth little or nothing. Any losses on mortgages owned or guaranteed by the two government-sponsored enterprises would be paid by taxpayers. A 1992 law allows that Fannie or Freddie be put into a conservatorship if their top regulator finds either one is “critically under-capitalized,” the Times said.

Shares of Fannie are down about 80% and Freddie’s shares have fallen about 87% over the past year. Between them, they own or guarantee about $5 trillion of mortgages, nearly half of all U.S. home-mortgage debt outstanding.

Will housing prices continue to further crash? I think it’s safe to say that they won’t be recovering any time soon.

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