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What would happen if we let them fail? Since they are not the main mortgage holders so what?
The problem is they (Fannie and Freddie) sold Trillions of $$$ worth of high-risk mortgages repackaged as intentionally misrepresented AAA-rated mortgage-backed securities worldwide. Everyone from pension plans to foreign governments would be royally screwed if we let them fail. That'll **** off more than a few people, friend and foe.
To understand more of what happened and why, read this article examining exactly why Obama gave Fannie and Freddie a blank check for bailouts for Christmas 2009, hoping the holiday would distract people enough that they wouldn't pay attention to what he had done. Origins of an American Kleptocracy | zero hedge
Fannie's and Freddie's unlimited bailout guarantee, courtesy of Obama:
Quote:
Friday, December 25, 2009
The Obama administration pledged Thursday to provide unlimited financial assistance to mortgage giants Fannie Mae and Freddie Mac, an eleventh-hour move that allows the government to exceed the current $400 billion cap on emergency aid without seeking permission from a bailout-weary Congress.
Hey but let's make sure we spend all our energies on Fin reg for Wall street!
Politicians simply cannot get anything right!
No they can't. It's not in their nature to do anything right.
Quote:
Originally Posted by InformedConsent
The problem is they (Fannie and Freddie) sold Trillions of $$$ worth of high-risk mortgages repackaged as intentionally misrepresented AAA-rated mortgage-backed securities worldwide. Everyone from pension plans to foreign governments would be royally screwed if we let them fail. That'll **** off more than a few people, friend and foe.
To understand more of what happened and why, read this article examining exactly why Obama gave Fannie and Freddie a blank check for bailouts for Christmas 2009, hoping the holiday would distract people enough that they wouldn't pay attention to what he had done. Origins of an American Kleptocracy | zero hedge
Fannie's and Freddie's unlimited bailout guarantee, courtesy of Obama:
Agreed. Some don't even care where the money came from...
In a time when Americans need to curb spending, our President, Congress, and the White House keep on spending like it's going out of style. That's a real nice example they're setting.
It's so easy to spend money that isn't yours, right??? I say let them fail!!!
Well trillion got my attention, obviously. I mean it really did. I knew Fannie and Freddie were in trouble but not to this extent. Even the low end estimate of $200 billion is mind blowing. And since trillion was not included in the budget, what then?
What would happen if we let them fail? Since they are not the main mortgage holders so what? I am sure someone on here could answer that.
I am just a simple peon in this country who got very excited when she got a $50.00 bonus at Christmas. Went right out and helped the economy by spending it on myself.
Billions and Trillions still catch my attention.
In this particular case.....it will become a multi-trillion dollar bailout, when all is said and done.
Add a battered and beaten commercial RE market too?
Where is the physical ousting of those who sold America on down the line?
Where are the public hangings of these traitors going to be held and WHEN?
Where is the justice for the CITIZENRY in this country?
[Dean Baker, co-director of the Center for Economic and Policy Research, who calls the Fannie and Freddie the elephant in the bailout room], and Fusion IQ's Barry Ritholtz are convinced the government is effectively sponsoring a backdoor bailout of the banks via the GSEs. "This is a conscious, willful decision," says Ritholtz, author of The Big Picture blog and Bailout Nation. "Fannie And Freddie act as a conduit for taking all this junk off the banks' balance sheets."
And Congress is along for the ride, says Baker. "To some extent the wool's been pulled over their eyes but I'd just say it's willingly. They just don't want to deal with it right now," he notes. The fear is cutting off aid to Fannie and Freddie could kill the housing industry. In the first quarter, the government backed more than 96% of all residential mortgages.
[Dean Baker, co-director of the Center for Economic and Policy Research, who calls the Fannie and Freddie the elephant in the bailout room], and Fusion IQ's Barry Ritholtz are convinced the government is effectively sponsoring a backdoor bailout of the banks via the GSEs. "This is a conscious, willful decision," says Ritholtz, author of The Big Picture blog and Bailout Nation. "Fannie And Freddie act as a conduit for taking all this junk off the banks' balance sheets."
And Congress is along for the ride, says Baker. "To some extent the wool's been pulled over their eyes but I'd just say it's willingly. They just don't want to deal with it right now," he notes. The fear is cutting off aid to Fannie and Freddie could kill the housing industry. In the first quarter, the government backed more than 96% of all residential mortgages.
Yes, that's going on, too. It's exacerbating the HUGE problem Fannie and Freddie created with their MASSIVE securities fraud (examined in Origins of an American Kleptocracy, linked earlier). They're on the hook for the garbage they sold worldwide PLUS they're taking on the garbage from the banks, as well.
Fannie and Freddie on the hook = taxpayers are left holding the bag
Yes, that's going on, too. It's exacerbating the HUGE problem Fannie and Freddie created with their MASSIVE securities fraud (examined in Origins of an American Kleptocracy, linked earlier). They're on the hook for the garbage they sold worldwide PLUS they're taking on the garbage from the banks, as well.
Fannie and Freddie on the hook = taxpayers are left holding the bag
Pay up, suckers!
Besides the hints at skulduggery, the point of that post was that Fannie and Freddie *can't* be abandoned. "The fear is cutting off aid to Fannie and Freddie could kill the housing industry. In the first quarter, the government backed more than 96% of all residential mortgages."
"The fear is cutting off aid to Fannie and Freddie could kill the housing industry.
Imagine that, not giving loans to people who aren't creditworthy would permantly deflate the housing bubble, and lead to excess housing stock. Who knew? /sarcasm
Quote:
In the first quarter, the government backed more than 96% of all residential mortgages."
No kidding . Banks won't touch residential mortgages after very ill-advised government intervention screwed up the housing market to begin with.
Besides the hints at skulduggery, the point of that post was that Fannie and Freddie *can't* be abandoned. "The fear is cutting off aid to Fannie and Freddie could kill the housing industry. In the first quarter, the government backed more than 96% of all residential mortgages."
You can't kill what's already DEAD.
Hell with 'em!
They failed and should NOT be rescued!
And BTW.....aren't you just thrilled that such a high percentage of loans are backed by those who are corrupt to the core and can't control their own spending?
Just wait until they feel the need to authorize their Eminent Domain powers.
Pack your bags and GET OUT!
A billion or more Chinese could be movin in.....and THEY really own US, so I suppose they must want some form of payment and I would imagine that 96% of the US housing market might make them happy....for now.
Remember....there ARE affirmed Mao-lovers plopped comfortably in the WH thesedays.
Yes, that's going on, too. It's exacerbating the HUGE problem Fannie and Freddie created with their MASSIVE securities fraud (examined in Origins of an American Kleptocracy, linked earlier). They're on the hook for the garbage they sold worldwide PLUS they're taking on the garbage from the banks, as well.
Fannie and Freddie on the hook = taxpayers are left holding the bag
Pay up, suckers!
Why is it when a private business commits fraud and royally s***ws customers and investors, the owners/leaders go to jail (Enron, etc), yet when a GSE does so they are rewarded with more money from the taxpayers? Stop the taxpayer funded bailouts, cut all government ties (eliminate GSEs) and investigate and prosecute the executives responsible for this cluster.
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Dont know if any of you have a government-backed mortgage.
It's exacerbating the HUGE problem Fannie and Freddie created with their MASSIVE securities fraud (examined in Origins of an American Kleptocracy, linked earlier). They're on the hook for the garbage they sold worldwide PLUS they're taking on the garbage from the banks, as well.
/sarcasm
. Banks won't touch residential mortgages after very ill-advised government intervention screwed up the housing market to begin with.
