I looked at the equity to debt ratios and fannie is levered 10 times more than freddie from what I can tell.
May I, in the friendliest way possible, suggest that you read up on the FTCM debacle in 1998 (couple of good books, not to mention an article or two of mine(g!)).
The lesson to be learned here, aside from internal corruption (which, oddly enough, LTCM weren't, they were straight-as-a-string traders until they got in over their heads), is this:
When it comes to portfolios that are heavily involved in high-leverage derivatives, ordinary business school stats such as debt-equity are 100% meaningless. Why? Because neither potential debt nor actual equity can be measured by any 'hard' methodolgy. One must deal (perhaps undesirably) with econometric models, and therefore the solvency of any such enterprise as these is dependent ENTIRELY on the accuracy of the model in use.
If overgearing (over-leveraging, in American English) can kill off an organisation of the smartest men, best traders, and finest theoreticians in the history of the world, then it can and will, one day, kill off a bunch of mediocre MBAs who couldn't find work in the private sectore, and almost surely much more quickly than such a policy killed off the 'smart guys'.
Fan, Fred, and Sal are all in this boat right now, have been for years AND their leverage has grown over the years, not shrunk (as it EFFING SHOULD HAVE, particularly after March 2000). The yield curve is going against them. These were ill-conceived ''quasi-private'' corporations to start, and they all operate under the **assumption** -- nothing written in law at all -- that if they get BIG enough, and subsequently fail, we taxpayers will be on the hook.
Sod them. Fannie was more blatantly corrupt (still is, I daresay), and violated its charter more than Freddie.
And they are both (as is Sallie) far too leveraged to withstand ANY sort of hiccup in their very curious derivatives exposure...absent of course the Regress bailing their sorry asses out with your and my money.