Skip to comments.Freddie Mac Loses $4.4B in Third Quarter, Requests $6B More From Treasury
Posted on 11/03/2011 10:20:35 AM PDT by ETL
Government-controlled mortgage giant Freddie Mac has requested $6 billion in additional aid after posting a wider loss in the third quarter.
Freddie Mac said Thursday that it lost $4.4 billion, or $1.86 per share, in the July-September quarter. That compares with a loss of $4.1 billion, or $1.25 a share, in the same quarter of 2010.
This quarter's $6 billion request from taxpayers is the largest since April 2010.
(Excerpt) Read more at foxnews.com ...
Bailout Politics: The Congressional Dems who enabled this crisis are now being trusted to fix it?
Thomas Sowell, September 30, 2008
Guilty Party: ACORN, Obama, and the mortgage mess
Mona Charen, September 30, 2008
An ACORN Falls from the Tree: A congressional outrage
Ken Blackwell, September 29, 2008
Any update on the bonuses for the directors? That came and went pretty fast in the news cycle.
a billion here a billion there before you know it we are talking real money.
” Any update on the bonuses for the directors? That came and went pretty fast in the news cycle. “
I was thinking, if they ‘lost’ 4.4, and ‘asked’ for 6, it must be coming up on “Bonus Time”.....
When last week we reported about the scandal of outgoing Freddie Mac CEO Ed Haldeman receiving at least $3.9 million as a reward for his two year tenure at the top of the insolvent and nationalized housing entity...
Put them down. It’s the humane thing to do.
Just more of the same, the establishment elites keep milking us sucker tax payers
They all seee the handwriting on the wall in this election cycle...they’re all going to manipulate and milk every source of revenue to their own purses ....like someone being evicted from their home...they’re going to steal and destroy all that’s left before they leave...
Can we Occupy Fannie Mae?
Give it to them, after all do we really have ANYTHING left to lose any more???
Please don’t get me started...I don’t know how much more I can take and remain sane
Hey, they need to pay for services rendered... or we'll show them what a real occupation is like!
Same here! It’s insanity run amuck. And the really insane part is....
we are doing NOTHING to stop it.
This is a long post I made the other day, but I am about 3/4 of the way through an unbelievable book: “Reckless Endangerment: How Outsized Ambition, Greed, and Corruption Led to Economic Armageddon” by Gretchen Morgenson and Joshua Rosner. This far into it, and I haven’t really been able to talk to anyone about it...:( I hope my somewhat long post can convince others to read it, because of the four books I have read on this subject, this one is by far and away the best explanation. It will make your blood boil.
A lot of people like to blame the banks in this fiasco. Banks are not blameless by any means in this, neither are Republicans by a long shot, but there is no doubt that the primary root causes of this entire mess are:
1.) Liberals in all branches of government and society
2.) Fannie Mae
3.) James Johnson
4.) Derivatives (securitized mortgages sold as investments, boatloads of subprime loans, packed into large bundles and sold as investments)
Liberals implemented this mess beginning with Fannie Mae back in the 30s. Even though it chugged along under the radar for decades, it was used primarily in a limited type of market, where they provided a mechanism (right or wrong) to allow certain types of more marginal lenders to get loans, which Fannie Mae would purchase from the lender and assume the risk. But it wasnt a monstrosity, just another government program, most people had only a vague understanding of what it was.
Beginning with the Community Reinvestment act in 1977, liberals in and out of government began pushing legislation under the rubrik of fairness to make it easier for unqualified people to get mortgages.
Every step along the way, anyone who threw even the slightest speedbump or raised the most innocuous objection was vilified, branded as a racist and characterized as being against working people.
When James Johnson took over Fannie Mae, this type of activity became codified as policy.
James Johnson saw the company as the cash cow it was for the bureaucrats who ran it, and implemented a strategy that was on the job 24x7 with eyes and ears everywhere. He created Fannie Mae branches in a huge number of cities across America (I think it was between 50 and 100) staffed by like-minded people who served as the canary in the coal mine for any push back. They had armies of powerful lobbyists with lots of important connections.
If any legislator, bank or agency even breathed a trace of opposition or conveyed any interest in rolling back or limiting what was going on at Fannie Mae, they were attacked immediately, unhesitatingly and with the full force of the liberal machine (which is what it was) often within an hour of making a statement or phone call.
In tandem with this iron fist, they would sweeten the pot for legislators to oppose, waffle or simply not vote on various proposals (at all levels of government) by making campaign donations, a lot of them.
There were very few politicians who could withstand both ends, which shows how corrupt they have become, or how effective a smear campaign can be. It is another manifestation of the liberal approach of You dont want this because you are against the working man/children/insert race here...
Even Speaker of the House Gingrich, who was supposed to be for small government and against entities like Fannie Mae, even got up on the podium with James Johnson in 1995 to sing the praises of Fannie Mae and their fulfillment of their manifest to provide mortgage access for minorities and such.
Nobody wants to be branded a racist, and even some people viewed as strong and principled didnt want to fight that battle.
James Johnson turned Fannie Mae into a fully functioning cash machine for Democrats in full view of everyone. A part of the book I read this morning described how, when a piece of proposed legislation came out that would tie the hands of Fannie Mae in even a small instance, it was countered by a massive email and letter campaign. It turned out that in one focal area, the Fannie Mae office had purchased a list of constituents in an area, made up letters with their names as constituents, and emailed and mailed them to the legislators. When it was discovered (the first nine constiuents who were called about the letters denied ever writing them, knowing anything about them or even agreeing with what they said) Johnson was called in front of a committee where the legislator for those constituents demanded a signed apology be mailed directly to each of his constituents in his district. Johnson not only did not agree to do this, but even caught red handed, came out aggressively and said he would do no such thing, but would send letters to those constituents asking them if they wanted a representative who was against providing the dream of home ownership for minorities (or some wording like that)
Just amazing arrogance, but that is how he ran it, because he was making scads of money there.
He lobbied congress relentlessly to change rules that allowed even more dangerous and shady practices, at each point along the way providing assurances (and getting the rating houses in bed with him to back him up) that these changes would have no deleterious effect.
A good example was a paper in 2002 (Johnson was no longer there, I think it was Raines by then) published by Joseph Stiglitz and Peter Orszag (who would, amazingly after publishing this piece of crap in 2002 become the HEAD of the OMB under Obama!) This paper dealt with risk management at Fannie Mae and Freddie Mac (who had much lower capital cushions than did other financial institutions) and concluded...get this...that the risk of some catastrophic incident or sequence of events requiring a bail-out by the government was between 500,000:1 and 3,000,000:1!!!!!!!!!! Geez, you think they could have made the range any broader??????
Anyway, they concluded that the cost of providing an EXPLICIT government guarantee on $1 Trillion in debt (that was Fannie Maes target...a trillion dollars for people who couldnt afford loans!) was only $2 Million.
Amazing. This dimwit who put out this paper to buttress an effort by liberal dipsticks to throw more gasoline on the fire in 2002 was actually appointed to the HEAD of the Office of Management and Budget under Obama!
And the securitization and bundling of loans allowed this crisis to not only metastisize throughout the entire US economy, but the world economy as well.
Bankers and Wall Street are complicit because, due to changes put in place by liberals, they no longer had to perform that nasty, time consuming and contentious underwriting task to find out who was safe to lend to. Now, they used automated tools that would let a dead cat buy a $250K house, and simply sold those loans to Fannie Mae or other entities who could now tie them all up in nice bundles to sell to investors.
Fannie Mae and the liberals made damn sure the rules were written in such a way that nobody could look inside those bundles before they purchased them to see the nature of the loans, which were all bad.
Wall Street and Bankers, doing what comes naturally to people who encounter a spigot with money flowing out of it, took advantage of it and put their mouths under it.
Gingrich, Bush and other Republicans, went along with it so as not to be villified, and went out of their way to assist. Why go halfway, right? They are complicit as well for not standing up, even though I do give some credit to the Bush administration for trying back in 2003-2004 to bring this issue to light. The OFHEO official in front of Barney Frank and the Banking Committee was essentially raped in public, and that was that.
It was like a perpetual motion money making machine...everyone wins and gets rich.
... and Barney Frank isn’t in prison because... ?
Who cares, eh?
It's just your money.
Everywhere you look, taxpayer money is being channelled to the Democrats to create more government...
This is criminal. FHMA continues to give loans to people who cannot afford those loans. It is nothing more than a multi-billion dollar wealth redistribution scam. The GOP House needs to do the right thing here and just say ‘no’. The bleeding stops now.
Will OWS finally start picketing in front of Christopher Dodd’s house? Didn’t think so.
Can we have Barney do the perp walk yet???
Well it depends on 1) Weather 2) How many 5 star chefs will cook for the vermin 3) How many media losers with cameras are on the scene 4) If they didn't oversleep due to so much marijuana use...
I was taking my courses for my Master's in the height of the economic collapse. My prof said in 2008 that Barney was taking the wrecking the ball to the US Economy via Fannie / Freddie and here we are in 2011. That Professor seems like a genius now...
Depends, OWS likes free food from 5 Star Chefs, they like to ban homeless until it gets cold and they "need advice". I hope I don't need to go to downtown Chicago and see these vermin or I may end up in jail. I own a small business, work my ass off every day and these vermin sit around complaining because their degree in Arts hasn't gotten them a job... WTF!!!
It certainly is profitable to lose money. Uncle Sugar will cover everything, and that way they don’t have to do anything different.
This is the difference between making and getting money.
Sure. They need a few billion more to cover the bonuses for their executives. I thought you had to do something good to earn a bonus.
What is wrong with these people?
The Cloward-Piven Strategy of Manufactured Crisis
[Obama's strategy for destroying the economy]
| August 31, 2008 | Jim Simpson
Liberals self-righteously wrap themselves in the mantle of public spirit. They ardently promote policies promising to deliver the poor and oppressed from their latest misery policies which can only find solution in the halls of government. But no matter what issue one examines, over the last fifty plus years, the liberal prescription has almost always been a failure.
Why is this so? Why does virtually every liberal scheme result in ever-increasing public spending while conditions seem to get continually worse? There are a number of reasons:
In short, all develop a vested interest in the programs survival. But if the result is always more and more government, of government, by government, and for government, with no solution in sight, then why do liberals always see government as the solution rather than the problem?
Similarly, liberals use government to promote legislation that imposes mandates on the private sector to provide further benefits for selected groups. But the results are even more disastrous. For example, weighing the laws or stacking the courts to favor unions may provide short term security or higher pay for unionized labor, but has ultimately resulted in the collapse of entire domestic industries.
Another example is health care. The Dems are always trying to impose backdoor socialized medicine with incremental legislation. Why do you suppose American healthcare is in such crisis? Answer: the government has already become too deeply involved. For example, many hospitals are closing their doors because they are overwhelmed with the burden of caring for indigent patients, illegal immigrants and vagrants who must, by law, be admitted like everyone else, despite the fact that they cannot pay for services. Read about it here Destroying Our Health Care. The net result is reduced availability of care for everyone, exactly the opposite of what liberals claim to want.
To further complicate things, liberal jurists and lawyers have created new theories of liability that utilize the legal system as a means to further redistribute income. This too, has resulted in higher costs and prices in affected industries, higher insurance costs, or in some cases, complete elimination of products or services.
Liberals endless pursuit of rights for different groups also does little but create increasing divisions in our society. Liberal policy pits old against young, men against women, ethnic and racial groups against one another, even American citizens against illegal aliens, all in the name of equality. The only result is anger, tension and equal misery for all.
How does any of this improve our lot?
Finally, when companies relocate overseas to avoid the high cost of unionized labor and heavy domestic regulation, liberals sarcastically excoriate them for outsourcing America. Yet, when it comes to certain domestic industries, liberals in Congress suddenly become free marketers and choose to buy from overseas contractors rather than domestic suppliers. This happened most recently with a huge military contract being outrageously awarded to the heavily subsidized European consortium, AIRBUS, over Americas own Boeing. Since liberals claim to be so determined to save the American worker, what gives?
You have to take a step further back and ask some fundamental questions. Why is the liberal public policy record one of such unmitigated disaster? I mean, even the worst batter hits one occasionally. No one bats zero. No one that is, except liberals.
Prior to the Republican takeover in Congress in 1994, Democrats had over fifty years of virtually unbroken power in Congress with substantial majorities most of the time. With all the time and money in the world trillions spent they couldnt fix a single thing, not one. Todays liberal has the same complaints, and the same old tired solutions. Can a group of smart people, studying issue after issue for years on end, with virtually unlimited resources at their command, not come up with a single policy that works? Why are they chronically incapable?
When things go bad all the time, despite the best efforts of all involved, I suggest to you something else is at work something deeper, more malevolent.
I submit to you that it is not a mistake, the failure is deliberate!
There is a method to the madness, and the method even has a name: the Cloward-Piven Strategy. It was first elucidated in the 1960s by a pair of radical leftist Columbia University professors, Richard Andrew Cloward and Frances Fox Piven:
The strategy of forcing political change through orchestrated crisis . the Cloward-Piven Strategy seeks to hasten the fall of capitalism by overloading the government bureaucracy with a flood of impossible demands, thus pushing society into crisis and economic collapse.
[Part II of this article will explore those organizations created to implement the Cloward-Piven strategy and their ties to the presidential candidacy of Barack Obama.]
The Complete Cloward-Piven Series
The Cloward-Piven Strategy, Part I: Manufactured Crisis
The Cloward-Piven Strategy, Part I print copy
The Cloward-Piven Strategy, Part II: Barack Obama and the Strategy of Manufactured Crisis
The Cloward-Piven Strategy, Part II print copy
The Cloward-Piven Strategy, Part III: Conspiracy of the Lemmings
The Cloward-Piven Strategy, Part III print copy
Hate Crimes Legislation Back Door Censorship
Also see (from David Horowitz's DiscoverTheNetworks.org) ...
THE CLOWARD-PIVEN STRATEGY (CPS):
Tuesday, January 05, 2010
By Glenn Beck
Meet Richard Cloward and Francis Fox Piven,
authors of the Cloward-Piven strategy
"I'm going to give you a hard concept to get your arms around: It's the concept that there are people in this country who want to intentionally collapse our economic system."-Glenn Beck
By Jeff Poor
Business & Media Institute, 9/24/2008
"Frank, who is openly gay, had a relationship with Herb Moses, an executive for the now-government controlled Fannie Mae. The column revealed the two had split up at the time but also said Frank was referring to Moses as his "spouse." Another Washington Post report said Frank called Moses his "lover" and that the two were "still friends" after the breakup.
Frank was and remains a stalwart defender of Fannie Mae, which is now under FBI investigation along with its sister organization Freddie Mac, American International Group Inc. (NYSE:AIG) and Lehman Brothers (NYSE:LEH) all recently participants in government bailouts. But Frank has derailed efforts to regulate the institution, as well as denying it posed any financial risk."
Lawmaker Accused of Fannie Mae Conflict of Interest
By Bill Sammon, October 03, 2008
WASHINGTON -- Unqualified home buyers were not the only ones who benefitted from Massachusetts Rep. Barney Franks efforts to deregulate Fannie Mae throughout the 1990s.
So did Franks partner, a Fannie Mae executive at the forefront of the agencys push to relax lending restrictions.
Now that Fannie Mae is at the epicenter of a financial meltdown that threatens the U.S. economy, some are raising new questions about Frank's relationship with Herb Moses, who was Fannies assistant director for product initiatives. Moses worked at the government-sponsored enterprise from 1991 to 1998, while Frank was on the House Banking Committee, which had jurisdiction over Fannie.
Both Frank and Moses assured the Wall Street Journal in 1992 that they took pains to avoid any conflicts of interest. Critics, however, remain skeptical.
"Its absolutely a conflict," said Dan Gainor, vice president of the Business & Media Institute. "He was voting on Fannie Mae at a time when he was involved with a Fannie Mae executive. How is that not germane?
"If this had been his ex-wife and he was Republican, I would bet every penny I have - or at least whats not in the stock market - that this would be considered germane," added Gainor, a T. Boone Pickens Fellow. "But everybody wants to avoid it because hes gay. Its the quintessential double standard."
A top GOP House aide agreed.
"Cmon, he writes housing and banking laws and his boyfriend is a top exec at a firm that stands to gain from those laws?" the aide told FOX News. "No media ever takes note? Imagine what would happen if Franks political affiliation was R instead of D? Imagine what the media would say if [GOP former] Chairman [Mike] Oxleys wife or [GOP presidential nominee John] McCains wife was a top exec at Fannie for a decade while they wrote the nations housing and banking laws."
Franks office did not immediately respond to requests for comment.
Frank met Moses in 1987, the same year he became the first openly gay member of Congress.
"I am the only member of the congressional gay spouse caucus," Moses wrote in the Washington Post in 1991. "On Capitol Hill, Barney always introduces me as his lover."
The two lived together in a Washington home until they broke up in 1998, a few months after Moses ended his seven-year tenure at Fannie Mae, where he was the assistant director of product initiatives. According to National Mortgage News, Moses "helped develop many of Fannie Maes affordable housing and home improvement lending programs."
Critics say such programs led to the mortgage meltdown that prompted last months government takeover of Fannie Mae and its financial cousin, Freddie Mac. The giant firms are blamed for spreading bad mortgages throughout the private financial sector.
Although Frank now blames Republicans for the failure of Fannie and Freddie, he spent years blocking GOP lawmakers from imposing tougher regulations on the mortgage giants. In 1991, the year Moses was hired by Fannie, the Boston Globe reported that Frank pushed the agency to loosen regulations on mortgages for two- and three-family homes, even though they were defaulting at twice and five times the rate of single homes, respectively.
Three years later, President Clintons Department of Housing and Urban Development tried to impose a new regulation on Fannie, but was thwarted by Frank. Clinton now blames such Democrats for planting the seeds of todays economic crisis.
"I think the responsibility that the Democrats have may rest more in resisting any efforts by Republicans in the Congress or by me when I was president, to put some standards and tighten up a little on Fannie Mae and Freddie Mac," Clinton said recently.
Bill Sammon is FOX News' Washington Deputy Managing Editor.
Rush Limbaugh's Barney Frank/"Banking Queen" parody of ABBA's "Dancing Queen" (fun-nee!):
Yes, the DemonRats’ strategy is to “spend, spend, spend”. On anything BUT the military that is, treasonous scum that they are.
Thanks for the post and interesting book recommendation.
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Wish in one hand, sh!t in the other and see which one fills up first.
It’s not just Obama and the Dems. GW Bush went to Harvard (see cartoon above) and was a big fan of “minority home ownership.” In 2004 his SEC allowed a sweetheart deal with Goldman etc. for only certain megabanks to allow them to have more debt and invest more in the ironically named “mortgage backed securities.” Bear Stearns bet 33 to 1 (33 debt for 1 equity.)
GW Bush probably trusted his advisers and did not understand this change very well. Paulson was the head of Goldman at that time and became treasury secretary later.
Obama is much worse of course. My point is that some in the GOP have helped them destroy the US economy.
Everyone is right. Many of these loans should have never been given out. The government should have NEVER got involved in a private real estate market. But that ship has sailed.
RE: “Barney Frank isnt in prison because... ?”
It would make all the Cell Block Bulls entirely too happy.
Besides; he might wear the poor cons out in no time flat!
That cartoon is a classic, and demonstrates how the Commucrat’s strategy hasn’t really changed all that much over the years.
About the only modifications I might suggest should anyone want to update this cartoon is to insert “BORROW” in between a couple of the “SPENDs” and change the identity of the shovel-wielders to reflect the current generation of power-mongering communist quislings.
For more insight about the chap up front flogging the donkey, see:
There was apparently a reason the artist put him up there.
Interestingly enough, Obama is a great admirer of FDR. Guess who Rex Tugwell worked and was a virtual “Czar” for?
Coincidence? I think not!
You might have to make the updated wagon a bit bigger to accommodate Lawdarse Bawney Fwank I suppose. Better double up on the jackasses too.
Do you sometimes wonder how many $Billions of American taxpayer’s dollars have vanished up Barry Soetoro’s nose or Bawney Fwanks’ *ahem*... “other end”?
Someone up at the Royal Palace is partying hearty on our... and now our grand children’s... cupronickle plated copper dime.
(How much is that dimes weight of copper worth now? They might have to start making them out of plastic. )
MICHELLE MALKIN has identified F/M as the place where members of the criminal enterprise known as the Democrat Party go to get rich.
AS ONE EXAMPLE Over the last two years, the Obama administration has approved a whopping $34.4 million in compensation to the top six executives of the financially troubled Fannie Mae and Freddie Mac mortgage giants while lacking basic protections to ensure such compensation is warranted, a federal watchdog found.
The largesse flowed to the six executives even though the two companies they run struggle to staunch billions of dollars in losses, remain in government conservatorship, and are required to repay taxpayers for assuming the companies liabilities during the mortgage crisis. Fannie and Freddie are tapping Treasury Department funds each quarter to help pay 10 percent dividends owed to the U.S. government.
The need for effectiveness, integrity, and transparency in FHFAs programs and operations cannot be overstated, said Inspector General Steve Linick, a former Justice Department prosecutor confirmed by Senate last year to watch over federal housing programs. Fannie Mae and Freddie Mac have received almost $154 billion in taxpayer funding to support the still-fragile housing market. In addition, they own or guarantee about $5.4 trillion in residential mortgage obligations.
audit freddie and fannie and by gosh hold everyone accountable...
it ain’t that hard.