Posted on 07/13/2008 3:31:33 PM PDT by Sleeping Freeper
U.S. rescues Fannie, Freddie Treasury Department raises credit line, has power to buy companies' stock. Fed will open discount-lending to two government-sponsored mortgage lenders. Paulson calls for new regulatory controls.
(Excerpt) Read more at marketwatch.com ...
Fannie Mae is a government sponsored enterprise set up in the 1930’s by FDR. Freddie Mac and Freddie Mae have 13 trillion in loans in the housing market. As of 2008, Fannie Mae and the Federal Home Loan Mortgage Corporation (Freddie Mac) own or guarantee about half of the U.S.’s $12 trillion mortgage market.
The United States government can not let these two mortgage lenders fail!
This crisis was caused by liberals insisting that unqualified minority and low-income homebuyers get access to the American Dream; and by de-regulation of the banking industry. Having said that, the Fed has absolutely no business in business. If something goes belly-up, let it float...I don't believe in government bailing out industry--government has only an oversight role.
Actually, we're in the TRILLIONS range, when you add in all the IOUs we've written for funding the war (e.g., promised benefits to vets, etc.)
And yet, more and more Americans cheer socialism.
Even on FR.
The risk was just officially secured by We the People through Treasury. Investors don’t care about moral hazards, they care about risk. This isn’t right that risk is being passed onto the taxpayer, I am just answering your statement about it going up. Now how much risk is being passed has not been answered, we’ll have to see how this thing develops. In general, I will buy real-estate in December, hold it and rent it for at least five years.
Also, accelerating my small business ventures in consumer healthcare and higher ed. Gold is a good hedge but not in the ‘it’s going to ten trillion camp’. More like 1,100 in the short-term and 1,500 in the mid-term before it begins reversing direction. Besides some bullion coins for worst case scenerio’s having Ft. Knox in your house would be a waste of time.
You know that will never happen although it should. These people at the top will unlikely face American justice. Even if a few do, one or two will be scapegoats and hundreds walk scott-free.
Why? So we can socialize everything for a few years and hope it gets better? Sounds like the Great Depression part 2 to me and we can thank Emperor Hirohito for forcing us to crank up 75% of our GDP for military spending to get out of that one. Meanwhile, at that time you had rations of everything. Jam was a luxury item. No thanks. I prefer a collpase and rebuild, eating wheat pasta and yellow cheese for a year then several years of socialism where I must work yet harder for the irresponsible and wait for some other empire to attack our weakended position.
I read at least one report that indicated that one method of bailout would be for the Fed to buy shares of the company...
Very true, they don’t think they did much wrong most of them. But some do understand 15 years of the Efficient Market Hyposis has failed. Firesales are what occur as punishment for bad market behavior but the mix of the twin city empire of NYC and Washington strikes again. The risk to the public was always there, the deflating real-estate asset has simply exposed it for what it is. Some names will remain attached to this massive abomination this time, it’s called a database. Hi Great Depression part 2. Meet the 21st Century socialists and speakeasy crowd. Let’s hope we are called the Greatest Generation part 2 when it is all over like it was in 1946 at the close of WWII.
No disagreement for the short-term about Iran but certainly the nation will now have to choose between the conservation model of the Democrats where there is a missing phase between conserve and save the planter or adding supply. The voters have already spoken but big money in Washington is the counter-force now preventing it from happening. It’s going to be quite a process unhinging the money from Washington, depression and major war are probably the unfortunate result, but I will stay hopeful and active as I can be in attempting to change things.
Dig deeper. This started in 1993 and both the Clintons and Bush’s responsible. Right now, blame is on Congress and I do recall President Bush/Cheney energy bill shot down by Democrats in 2002. Then President Bush on national T.V. in 2005 and 2006 stating we must become free of our oil addiction. I didn’t see Ted Kennedy, Nancy Pelosi or other Democrats talking about this, all I heard was Bush is an oilman and oil is bad. So is coal. Coal is dirty and pollutes our atmosphere. Coal is bad.
Step right up, election season is right around the corner! No? Gee, I wonder why not! It takes money to run an election buddy, the rules changed much over the last twenty years. Offer solutions. I am building a fund for public servants that cannot AFFORD to take a year off from work without the RNC or DNC special ‘sponsors’. All you do is condemn people here, get a grip on yourself man.
Bingo, and it allows those at the top to suck millions each from bonuses and liquidating positions. Then redeploy the cash while it has much higher value into tangible, necessary commodities, along with the rest of the friendly global investors like ICE, GCC and Russia. The world has bet on our corruption in Washington, no different then the U.N. oil for food scandal, just on a much bigger scale but it’s not the Iraqi people whom the joke is on, it’s the American people.
I do: Subsidize $200 B from Treasury into energy independence including drilling, nuclear, coal and biodiesel. Provide the funds to commercial banks that have demonstrated fiscal responsibility these past five years. Provide $50 B to the Small Business Administration which partners with local banks. SBA helps entrepenuars get the loans, polish business plans and connects them to other angel and VC money. Nice plan eh? Submitted this to the President who read this in March where I flatly stated the only way to avoid depression by 2011 is to invest in energy asset classes which empower everything else we do as a capatalist society. I can tell you there was positive response.
I also advised the President to watch out for Alt-A’s, that irresponsible banks would begin crying out for more lube prior to election and to question Henry Paulson’s motives in how he runs Treasury.
Truth is, more damage was done to this country in 2006-current with this far left House. As many aptly put it in the past, the jellyfish that has become the Republican party has indeed lost there conservative backbones and common sense. If the Republican party was that of old, you would see fists flying on the Hill. That is what indeed it may take at some point...
Thats a little too big too hide even for too big to fail, LOL. They will become nationalized, the hatchet people will come in and axe management and missapropriations, the housing market will bottom (2010) and the company will be privatized once again. The taxpayer will eat some things in between and penny one is too much! However, it will not be 2-3 trillion, although you can blame the socialist party for creating this real-estate bubble in the first place and the pubbies for there lack of oversight between 2001-2006.
Probably quite a few, this and future actions backed by the Treasury will create a floor for real-estate sooner rather then later. More poor market manipulation resulting from poor market manipulation.
Start shorting it, then, man! There's piles of money to be made!!!
(if you're right)
“Frank and Dodds haven’t done crap for five years other than collect contributions from banks and get us into this mess, why are they still being listened too?”
It’s an election year. Dems are too busy promoting how lametarded Bush was and the Republicans are just starting to get a game plan together. Congress focused on what you would expect any counter-culture politician to focus in on. Rules for baseball, toilets, hating Bush, Iraq defeat, shall I go on?
You runnin’ for office anytime soon?
And let me add that small business is where the jobs have been felt the most. Bigger associates of the government like Freddie and Fannie are getting loans. Where’s the money for the other 49% of the responsible GDP? It’s not there, because Treasury and Fed are serving what’s left to banks. For each social bailout to the bigs, capital investment back INTO our country should be provided in equal measure to create skilled jobs.
I agree with your assessement completely and am a small business owner. I don’t ever want to hear again from financial gurus whom tell me I nor my family has not suffered and this doesn’t effect the ‘real economy’, it’s all notional and hence has no effect in the picture on the ground!
I am in Consumer Healthcare, not retail and I have worked 14 hours a day and weekends since June of 2007 when I ran the numbers on what was coming. When I saw the financial gurus telling the public chance of recession is 25% while LIQUIDATING there real-estate holdings, I knew it was time to run a flash economic study. My grandmother whom lived through the Great Depression summed it all up this way: Never trust bankers, they love foreclosures!
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