Fannie and Freddie Takeover Announced
- Thread starter tmare_IHB
- Start date
NEW -> Contingent Buyer Assistance Program
NoWowway_IHB
New member
Obama has these comments on the F/F thing. Maybe someone can come up with a McCain statement. IMO this is where the rubber hits the road. Both camps better be able to discuss the economy and some of the more disasterous aspects of our current economic challenges. Anyways, here is Obama's (There is a discussion thread following it with over 600 comments - btw, why does CNN NOT HAVE MESSAGE BOARDS? Did I miss them, somehow?):
http://my.barackobama.com/page/content/hqblog
<strong>Statement from Senator Obama on Fannie Mae and Freddie Mac</strong>
With discussions underway about possible government intervention to back troubled mortgage giants Fannie Mae and Freddie Mac, Senator Obama released the following statement today:
The extremely serious situation with Fannie Mae and Freddie Mac affects millions of homeowners, our financial system, and our entire economy. I have been and will continue to monitor this situation closely, and I?ll evaluate whatever plan is put forth by this Administration with the following three benchmarks:
First, any action we take must be focused not on the whims of lobbyists and special interests worried about their bonuses and hourly fees, but on whether it will strengthen our economy and help struggling homeowners who are also being hit by lost jobs, stagnant wages and spiraling costs for everything from gas to groceries.
Second, we must protect taxpayers, not bail out the shareholders and management of Fannie Mae and Freddie Mac. This is a challenging situation, and there are some community and regional banks, including those serving low-income communities, that we need to carefully address. But we must not allow government intervention to protect investors and speculators who relied on the government to reap massive profits.
Finally, we must ensure that any plan clarifies the true public and private status of our housing policies. We need to make clear that in our market system, investors must not be allowed to believe that, unlike working families, they can simply invest in a ?heads they win, tails they don?t lose? context.
For too long, Washington ignored the warning signs in the housing and financial markets, and has been unwilling to take the kind of actions that I have been advocating for over two years to crack down on reckless borrowers and help struggling homeowners. We cannot afford more of this ?wait and don?t see? approach to our markets and our economy.
With today?s announcement, as well as the discouraging job report Friday, I once again urge the Administration and Senator McCain to drop their opposition to a second stimulus package, and to come together around a package like I have proposed, with immediate relief for families and $50 billion to struggling states so that they don?t have to cut back on health care and education and can rebuild roads and schools and help restore jobs and confidence to our economy.
http://my.barackobama.com/page/content/hqblog
<strong>Statement from Senator Obama on Fannie Mae and Freddie Mac</strong>
With discussions underway about possible government intervention to back troubled mortgage giants Fannie Mae and Freddie Mac, Senator Obama released the following statement today:
The extremely serious situation with Fannie Mae and Freddie Mac affects millions of homeowners, our financial system, and our entire economy. I have been and will continue to monitor this situation closely, and I?ll evaluate whatever plan is put forth by this Administration with the following three benchmarks:
First, any action we take must be focused not on the whims of lobbyists and special interests worried about their bonuses and hourly fees, but on whether it will strengthen our economy and help struggling homeowners who are also being hit by lost jobs, stagnant wages and spiraling costs for everything from gas to groceries.
Second, we must protect taxpayers, not bail out the shareholders and management of Fannie Mae and Freddie Mac. This is a challenging situation, and there are some community and regional banks, including those serving low-income communities, that we need to carefully address. But we must not allow government intervention to protect investors and speculators who relied on the government to reap massive profits.
Finally, we must ensure that any plan clarifies the true public and private status of our housing policies. We need to make clear that in our market system, investors must not be allowed to believe that, unlike working families, they can simply invest in a ?heads they win, tails they don?t lose? context.
For too long, Washington ignored the warning signs in the housing and financial markets, and has been unwilling to take the kind of actions that I have been advocating for over two years to crack down on reckless borrowers and help struggling homeowners. We cannot afford more of this ?wait and don?t see? approach to our markets and our economy.
With today?s announcement, as well as the discouraging job report Friday, I once again urge the Administration and Senator McCain to drop their opposition to a second stimulus package, and to come together around a package like I have proposed, with immediate relief for families and $50 billion to struggling states so that they don?t have to cut back on health care and education and can rebuild roads and schools and help restore jobs and confidence to our economy.
NoWowway_IHB
New member
http://online.wsj.com/article/SB122073255846107191.html?mod=...
In a statement Saturday, Sen. Obama called the situation "extremely serious" and said it affects "our entire economy." He added: "Any action we take must be focused not on the whims of lobbyists and special interests worried about their bonuses and hourly fees, but on whether it will strengthen our economy and help struggling homeowners."
Sen. Obama said the rescue also "must protect taxpayers, not bail out the shareholders and management of Fannie Mae and Freddie Mac."
Sounds like a reasonable approach to me.
In a statement Saturday, Sen. Obama called the situation "extremely serious" and said it affects "our entire economy." He added: "Any action we take must be focused not on the whims of lobbyists and special interests worried about their bonuses and hourly fees, but on whether it will strengthen our economy and help struggling homeowners."
Sen. Obama said the rescue also "must protect taxpayers, not bail out the shareholders and management of Fannie Mae and Freddie Mac."
Sounds like a reasonable approach to me.
tmare_IHB
New member
I'm also wondering if we have entered into the official period where the Alt-A and other adjustable mortgages are significantlycontributing to a further rise in the foreclosure rate. I have been reading for at least a year about this and the predictions were all of serious doom and gloom. Are we in the beginning or even middle of this problem or has it not really even hit yet? If it hasn't hit yet, it is frightening to think how much worse this is going to get.
NoWowway_IHB
New member
McCain weighs in on F/F:
http://watchingtheherd.blogspot.com/2008/09/mccain-on-fannie-freddie-bailout.html
On the September 7, 2008 edition of Face the Nation, Senator John McCain made the following comment about the forthcoming Treasury intervention at Fannie Mae and Freddie Mac (loosely paraphrased):
<em><strong>I?ve talked with Treasury Secretary Paulson and the deal is structured so that when housing recovers, and it will, the American taxpayer will be the first to be paid off.</strong></em>
This indicates a lack of understanding of how the securitization process works. When a retail loan is sold by the originating lender, the originating lender gets their money in its entirety and they no longer have any exposure to a default from the borrower. When Fannie or Freddie buy that loan and manage to resell it to yet another party, they too no longer have any exposure to a loss if the borrower defaults. The risk lies only with those mortgages Fannie and Freddie have ?in inventory? awaiting resell or those they choose to keep in their portfolio.
The impact is easier to follow with a specific example. Start with a mortgage issued for a home originally sold in 2006 in California for $500,000 with a $450,000 mortgage (10 percent down) with interest-only balloon terms increasing the payments in 2008. Assume the loan itself was resold to Fannie or Freddie between 2006 and 2008 and is still sitting in their ?inventory? and now the borrower has defaulted on the loan and cannot make the higher payments. Also assume the house itself is now worth only $400,000, below the mortgage amount. In this example at the time of the default:
* the original lender is ?whole? and lost no money and WILL lose no money
* the borrower cannot afford the house unless terms are renegotiated by the current note holder (Fannie or Freddie)
* the current loss on the mortgage is $50,000 (difference between the note and current home value) since the interest-only note paid down no principle
* if the house is sold to another party, THAT party cannot be forced to borrow from Fannie or Freddie to help them make up their losses on the current borrower
The key point is that once a loss on a loan is recognized, that loss hits the books of Fannie or Freddie. A future mortgage on the home involved with that loss is originated at the retail level to the new borrower ? Fannie and Freddie are not retail lenders. If that mortgage isn?t resold to Fannie or Freddie, then future profits from that subsequent mortgage won?t flow to Fannie or Freddie. As a result, any restructuring plan for Fannie and Freddie cannot ?guarantee? taxpayers that future profits when prices recover will make up interim losses suffered absorbing current defaults. If Fannie and Freddie cannot more accurately reflect the provenance of mortgages they are reselling to identify those in geographic markets that are underwater or at higher risk for default, investors will simply shun ALL of their MBS offerings, further tanking the market. If they adequately disclose the quality of loans within their MBS offerings, investors will simply shun those tied to the riskiest markets, sticking Fannie and Freddie with the junk, keeping the losses isolated to Fannie and Freddie and, hence, US taxpayers.
If the bailout plan for Fannie and Freddie simply involves providing Treasury backup for the solvency of the entities? books, then there is NO WAY the plan can allow US taxpayers to be made whole in the long term as the market recovers. The losses will stick with the entities (and taxpayers) and the profits from mortgages to future borrowers will flow to the final note holders. Such a plan would only serve to hopefully keep the problem from getting worse via further liquidity problems but will do NOTHING to eliminate losses absorbed by taxpayers. If the bailout plan requires Fannie and Freddie to surrender all profits back to the government until losses are repaid, they will have a very difficult time reorganizing themselves and attracting new outside capital, further deepening their dependency on taxpayers. If the bailout for Fannie and Freddie allows the new government conservators to waive the rules of accounting and NOT mark the value of defaulted mortgages to market and defer recognition of the losses, we have a much more critical legal and financial problem.
None of the solutions for the problem are attractive and none are likely to protect us from a further meltdown without protecting many guilty parties in the financial industry and allowing them to keep the profits from this colossal fraud. However, it?s disconcerting to see a reform-minded Presidential candidate claiming the deal will (eventually) make taxpayers whole and confirming a critical lack of understanding about the basics of a trillion dollar problem he would inherit if elected.
http://watchingtheherd.blogspot.com/2008/09/mccain-on-fannie-freddie-bailout.html
On the September 7, 2008 edition of Face the Nation, Senator John McCain made the following comment about the forthcoming Treasury intervention at Fannie Mae and Freddie Mac (loosely paraphrased):
<em><strong>I?ve talked with Treasury Secretary Paulson and the deal is structured so that when housing recovers, and it will, the American taxpayer will be the first to be paid off.</strong></em>
This indicates a lack of understanding of how the securitization process works. When a retail loan is sold by the originating lender, the originating lender gets their money in its entirety and they no longer have any exposure to a default from the borrower. When Fannie or Freddie buy that loan and manage to resell it to yet another party, they too no longer have any exposure to a loss if the borrower defaults. The risk lies only with those mortgages Fannie and Freddie have ?in inventory? awaiting resell or those they choose to keep in their portfolio.
The impact is easier to follow with a specific example. Start with a mortgage issued for a home originally sold in 2006 in California for $500,000 with a $450,000 mortgage (10 percent down) with interest-only balloon terms increasing the payments in 2008. Assume the loan itself was resold to Fannie or Freddie between 2006 and 2008 and is still sitting in their ?inventory? and now the borrower has defaulted on the loan and cannot make the higher payments. Also assume the house itself is now worth only $400,000, below the mortgage amount. In this example at the time of the default:
* the original lender is ?whole? and lost no money and WILL lose no money
* the borrower cannot afford the house unless terms are renegotiated by the current note holder (Fannie or Freddie)
* the current loss on the mortgage is $50,000 (difference between the note and current home value) since the interest-only note paid down no principle
* if the house is sold to another party, THAT party cannot be forced to borrow from Fannie or Freddie to help them make up their losses on the current borrower
The key point is that once a loss on a loan is recognized, that loss hits the books of Fannie or Freddie. A future mortgage on the home involved with that loss is originated at the retail level to the new borrower ? Fannie and Freddie are not retail lenders. If that mortgage isn?t resold to Fannie or Freddie, then future profits from that subsequent mortgage won?t flow to Fannie or Freddie. As a result, any restructuring plan for Fannie and Freddie cannot ?guarantee? taxpayers that future profits when prices recover will make up interim losses suffered absorbing current defaults. If Fannie and Freddie cannot more accurately reflect the provenance of mortgages they are reselling to identify those in geographic markets that are underwater or at higher risk for default, investors will simply shun ALL of their MBS offerings, further tanking the market. If they adequately disclose the quality of loans within their MBS offerings, investors will simply shun those tied to the riskiest markets, sticking Fannie and Freddie with the junk, keeping the losses isolated to Fannie and Freddie and, hence, US taxpayers.
If the bailout plan for Fannie and Freddie simply involves providing Treasury backup for the solvency of the entities? books, then there is NO WAY the plan can allow US taxpayers to be made whole in the long term as the market recovers. The losses will stick with the entities (and taxpayers) and the profits from mortgages to future borrowers will flow to the final note holders. Such a plan would only serve to hopefully keep the problem from getting worse via further liquidity problems but will do NOTHING to eliminate losses absorbed by taxpayers. If the bailout plan requires Fannie and Freddie to surrender all profits back to the government until losses are repaid, they will have a very difficult time reorganizing themselves and attracting new outside capital, further deepening their dependency on taxpayers. If the bailout for Fannie and Freddie allows the new government conservators to waive the rules of accounting and NOT mark the value of defaulted mortgages to market and defer recognition of the losses, we have a much more critical legal and financial problem.
None of the solutions for the problem are attractive and none are likely to protect us from a further meltdown without protecting many guilty parties in the financial industry and allowing them to keep the profits from this colossal fraud. However, it?s disconcerting to see a reform-minded Presidential candidate claiming the deal will (eventually) make taxpayers whole and confirming a critical lack of understanding about the basics of a trillion dollar problem he would inherit if elected.
NoWowway_IHB
New member
<object width="325" height="250"><embed src="http://www.youtube.com/v/youtube" type="application/x-shockwave-flash" width="325" height="250"></embed></object>
One of the concerns about "solving" the F/F issue, is that the information has to be forthcoming from the Feds and Bush Administration. I thought Obama outlined what the structural problems are and how to eliminate unnecessary risk from this sector.
Looking forward to what Nude thinks.
Man, I have no idea what I could have done this time to get this video embedded. Hmmmm
I got it from this page:
http://thepoliticalcarnival.blogspot.com/2008/09/video-obama-on-mortgage-giants.html
One of the concerns about "solving" the F/F issue, is that the information has to be forthcoming from the Feds and Bush Administration. I thought Obama outlined what the structural problems are and how to eliminate unnecessary risk from this sector.
Looking forward to what Nude thinks.
Man, I have no idea what I could have done this time to get this video embedded. Hmmmm
I got it from this page:
http://thepoliticalcarnival.blogspot.com/2008/09/video-obama-on-mortgage-giants.html
NoWowway_IHB
New member
The Politics of Fannie and Freddie Takeover
http://boards.fool.com/Message.asp?mid=26968793
<em>Most people around here already seem to understand that most government actions under the Bush administration have served corrupt political or financial purposes. I suspect, however, that most casual observers don't understand how this all fits in with the GSE takeover plan announced today. Having read through all the statements offered by the treasury this morning, here are my thoughts:
It is clear that the takeover of Fannie and Freddie has been carefully constructed to serve the political purposes of the Republican party. Fannie Mae and Freddie Mac have always been politically aligned with the Democratic party. They have historically been big campaign contributors to Democratic candidates, but recently the donations have been spread more evenly between the two main parties because the Republicans have controlled the GSEs regulator.
The stated purpose of Fannie an Feddie has been to make housing more affordable. This goes directly contrary to the primary goal of the Republican party which is to squeeze as much wealth out of the middle class as possible and transfer it to their rich and powerful allies.
The GSEs have been in competition with Wall Street investment banks in the securitization market, and they also have a goal of extracting as much wealth as possible from the American people. For that matter, the investment banks constitute the most important "rich and powerful allies" of the Republican party.
Hank Paulson left his job as CEO of Golman Sachs to run the Treasury Department. He has been the major architect of the plan to take over the Fannie and Freddie. The deal has clearly been designed to cripple the institutions over the long term, and eliminate their ability to help out Democratic candidates in the short term.
One of the restrictions put on the GSEs is for them to immediatly stop their lobbying efforts.
There had been much speculation that the Treasury would inject capital into the firms in order to support them as strong entities. Instead they just pledged to provide enough capital to keep them solvent. This would be in the form of preferred shares that payed 10-12% interest.
The goal clearly is to cripple them financially. This ensures that their impact will be minimal even if Democrats eventually regain control and try to revitalize them.
The portfolio caps are lifted so that they can buy up as much toxic mortgage debt as possible and take some pressure off of the banks who are struggling from the housing crash. However, Fannie and Freddie will have to start dramatically reducing their own portfolio holdings in 2010, presumably preventing them from doing well after the market recovers. Just as they were forced to limit their growth as the last housing boom really took off, they will likely be forced to contract when the housing market is finally set to recover.
Press releases from the Treasury Department:
http://www.treasury.gov/news/index1.html</em>
http://boards.fool.com/Message.asp?mid=26968793
<em>Most people around here already seem to understand that most government actions under the Bush administration have served corrupt political or financial purposes. I suspect, however, that most casual observers don't understand how this all fits in with the GSE takeover plan announced today. Having read through all the statements offered by the treasury this morning, here are my thoughts:
It is clear that the takeover of Fannie and Freddie has been carefully constructed to serve the political purposes of the Republican party. Fannie Mae and Freddie Mac have always been politically aligned with the Democratic party. They have historically been big campaign contributors to Democratic candidates, but recently the donations have been spread more evenly between the two main parties because the Republicans have controlled the GSEs regulator.
The stated purpose of Fannie an Feddie has been to make housing more affordable. This goes directly contrary to the primary goal of the Republican party which is to squeeze as much wealth out of the middle class as possible and transfer it to their rich and powerful allies.
The GSEs have been in competition with Wall Street investment banks in the securitization market, and they also have a goal of extracting as much wealth as possible from the American people. For that matter, the investment banks constitute the most important "rich and powerful allies" of the Republican party.
Hank Paulson left his job as CEO of Golman Sachs to run the Treasury Department. He has been the major architect of the plan to take over the Fannie and Freddie. The deal has clearly been designed to cripple the institutions over the long term, and eliminate their ability to help out Democratic candidates in the short term.
One of the restrictions put on the GSEs is for them to immediatly stop their lobbying efforts.
There had been much speculation that the Treasury would inject capital into the firms in order to support them as strong entities. Instead they just pledged to provide enough capital to keep them solvent. This would be in the form of preferred shares that payed 10-12% interest.
The goal clearly is to cripple them financially. This ensures that their impact will be minimal even if Democrats eventually regain control and try to revitalize them.
The portfolio caps are lifted so that they can buy up as much toxic mortgage debt as possible and take some pressure off of the banks who are struggling from the housing crash. However, Fannie and Freddie will have to start dramatically reducing their own portfolio holdings in 2010, presumably preventing them from doing well after the market recovers. Just as they were forced to limit their growth as the last housing boom really took off, they will likely be forced to contract when the housing market is finally set to recover.
Press releases from the Treasury Department:
http://www.treasury.gov/news/index1.html</em>
FairEconomist_IHB
New member
[quote author="NoWowway" date=1220845397]McCain weighs in on F/F:
http://watchingtheherd.blogspot.com/2008/09/mccain-on-fannie-freddie-bailout.html
On the September 7, 2008 edition of Face the Nation, Senator John McCain made the following comment about the forthcoming Treasury intervention at Fannie Mae and Freddie Mac (loosely paraphrased):
<em><strong>I?ve talked with Treasury Secretary Paulson and the deal is structured so that when housing recovers, and it will, the American taxpayer will be the first to be paid off.</strong></em>
</blockquote>
Bah. Obama has been trying to fix an underlying cause of the bubble and crash (mortgage fraud) for over 2 years now. McCain is *still* in fantasyland. If he gets elected there will be a huge effort to reflate the bubble and get those imaginary Fannie and Freddie profits he's dreaming about.
http://watchingtheherd.blogspot.com/2008/09/mccain-on-fannie-freddie-bailout.html
On the September 7, 2008 edition of Face the Nation, Senator John McCain made the following comment about the forthcoming Treasury intervention at Fannie Mae and Freddie Mac (loosely paraphrased):
<em><strong>I?ve talked with Treasury Secretary Paulson and the deal is structured so that when housing recovers, and it will, the American taxpayer will be the first to be paid off.</strong></em>
</blockquote>
Bah. Obama has been trying to fix an underlying cause of the bubble and crash (mortgage fraud) for over 2 years now. McCain is *still* in fantasyland. If he gets elected there will be a huge effort to reflate the bubble and get those imaginary Fannie and Freddie profits he's dreaming about.
Anonymous_IHB
New member
Hey, it's a Clinton Democrat dude that got us in the mess in the first place - and made off with $50 million for himself by overstating earnings ...
http://en.wikipedia.org/wiki/Franklin_D._Raines
[quote author="FairEconomist" date=1220868895][quote author="NoWowway" date=1220845397]McCain weighs in on F/F:
http://watchingtheherd.blogspot.com/2008/09/mccain-on-fannie-freddie-bailout.html
On the September 7, 2008 edition of Face the Nation, Senator John McCain made the following comment about the forthcoming Treasury intervention at Fannie Mae and Freddie Mac (loosely paraphrased):
<em><strong>I?ve talked with Treasury Secretary Paulson and the deal is structured so that when housing recovers, and it will, the American taxpayer will be the first to be paid off.</strong></em>
</blockquote>
Bah. Obama has been trying to fix an underlying cause of the bubble and crash (mortgage fraud) for over 2 years now. McCain is *still* in fantasyland. If he gets elected there will be a huge effort to reflate the bubble and get those imaginary Fannie and Freddie profits he's dreaming about.</blockquote>
http://en.wikipedia.org/wiki/Franklin_D._Raines
[quote author="FairEconomist" date=1220868895][quote author="NoWowway" date=1220845397]McCain weighs in on F/F:
http://watchingtheherd.blogspot.com/2008/09/mccain-on-fannie-freddie-bailout.html
On the September 7, 2008 edition of Face the Nation, Senator John McCain made the following comment about the forthcoming Treasury intervention at Fannie Mae and Freddie Mac (loosely paraphrased):
<em><strong>I?ve talked with Treasury Secretary Paulson and the deal is structured so that when housing recovers, and it will, the American taxpayer will be the first to be paid off.</strong></em>
</blockquote>
Bah. Obama has been trying to fix an underlying cause of the bubble and crash (mortgage fraud) for over 2 years now. McCain is *still* in fantasyland. If he gets elected there will be a huge effort to reflate the bubble and get those imaginary Fannie and Freddie profits he's dreaming about.</blockquote>
Trooper_IHB
New member
<em>If investors buy into Paulson's program, <strong>mortgage rates should fall</strong> because Fannie and Freddie's borrowing costs will fall. That, in turn, could lessen the steepness of the decline in home prices.
But with the economy slowing and the U.S. financial system under severe stress from the collapse of the housing bubble, it's not clear that even full government backing for Fannie and Freddie will bring mortgage rates down substantially.</em>
Seriously.....rates will fall ? I don't know.... anyone have an informed opinion ?
<a href="http://money.cnn.com/2008/09/08/news/economy/barr_paulson.fortune/index.htm?postversion=2008090807">Paulson blather</a>
But with the economy slowing and the U.S. financial system under severe stress from the collapse of the housing bubble, it's not clear that even full government backing for Fannie and Freddie will bring mortgage rates down substantially.</em>
Seriously.....rates will fall ? I don't know.... anyone have an informed opinion ?
<a href="http://money.cnn.com/2008/09/08/news/economy/barr_paulson.fortune/index.htm?postversion=2008090807">Paulson blather</a>
usctrojanman29_IHB
New member
[quote author="Trooper" date=1220910631]<em>If investors buy into Paulson's program, <strong>mortgage rates should fall</strong> because Fannie and Freddie's borrowing costs will fall. That, in turn, could lessen the steepness of the decline in home prices.
But with the economy slowing and the U.S. financial system under severe stress from the collapse of the housing bubble, it's not clear that even full government backing for Fannie and Freddie will bring mortgage rates down substantially.</em>
Seriously.....rates will fall ? I don't know.... anyone have an informed opinion ?
<a href="http://money.cnn.com/2008/09/08/news/economy/barr_paulson.fortune/index.htm?postversion=2008090807">Paulson blather</a></blockquote>
As I stated in a few other threads...mortgage rates have fallen about .50% from Friday.
But with the economy slowing and the U.S. financial system under severe stress from the collapse of the housing bubble, it's not clear that even full government backing for Fannie and Freddie will bring mortgage rates down substantially.</em>
Seriously.....rates will fall ? I don't know.... anyone have an informed opinion ?
<a href="http://money.cnn.com/2008/09/08/news/economy/barr_paulson.fortune/index.htm?postversion=2008090807">Paulson blather</a></blockquote>
As I stated in a few other threads...mortgage rates have fallen about .50% from Friday.
optimusprime_IHB
New member
WSJ treats us to these summaries of the presidential candidates' positions on Fannie and Freddie:
Sen. John McCain, the Republican nominee for president, has said his goal is to make the companies "go away" and to push for regulation that "limits their ability to borrow, shrinks their size until they are no longer a threat to our economy and privatizes and eliminates their links to the government." Sen. McCain supported giving Treasury the authority to backstop the firms but has said any use of taxpayer funds should be combined with an ouster of management and a ban on lobbying by the companies.
Sen. Barack Obama, the Democratic nominee, has said the companies are a "weird blend" and that "if these are public entities, then they've got to get out of the profit-making business, and if they're private entities, then we don't bail them out."
Sen. John McCain, the Republican nominee for president, has said his goal is to make the companies "go away" and to push for regulation that "limits their ability to borrow, shrinks their size until they are no longer a threat to our economy and privatizes and eliminates their links to the government." Sen. McCain supported giving Treasury the authority to backstop the firms but has said any use of taxpayer funds should be combined with an ouster of management and a ban on lobbying by the companies.
Sen. Barack Obama, the Democratic nominee, has said the companies are a "weird blend" and that "if these are public entities, then they've got to get out of the profit-making business, and if they're private entities, then we don't bail them out."
FairEconomist_IHB
New member
Raines is a crook and should be in jail (along with dozens of other CEOs; you'll find no group with more examples of unpunished criminals). But Fannie and Freddie didn't cause the bubble and crash, and Raines' policies didn't get Fannie wrapped up in it either. The bubble was caused by Greenspan's ultralow rates and the crooked/speculative NON-Gse mortgage system. Fannie and Freddie are going down now partly because the bubble was so enormous even responsible lenders could get pulled down and partly because they were totally unprepared for the massive fraud and wild speculation going on when they stepped in to "rescue" the market in 2007. Both those decisions post-date Raines by years.
Trooper_IHB
New member
<em>As I stated in a few other threads...mortgage rates have fallen about .50% from Friday. </em>
Yes, I saw that after I posted. Check my response on the other thread you commented on.
Yes, I saw that after I posted. Check my response on the other thread you commented on.