Fannie Mae plans to tap $11 billion in new government aid after posting another massive quarterly loss as the taxpayer bill from the housing market bust keeps growing.
The mounting price tag for the rescue of Fannie and its goverment-sponsored sibling, Freddie Mac, is surpassed only by insurer American International Group Inc., which has received $182.5 billion in financial support from the government so far.
Fannie Mae’s new request for $10.7 billion from the Treasury Department will bring the total for Fannie and Freddie to nearly $96 billion. Freddie is expected to report its quarterly results on Friday.
Ugh. One wonders when the red ink will ever end. Read it all.
Outrageous. Break it up and privatize it.
Wait a minute. This cannot be.
[b]Frank defends oversight of Fannie, Freddie[/b]
By ANNE FLAHERTY (AP) – Jul 24, 2009
WASHINGTON — House Financial Services Chairman Barney Frank is defending Democrats’ oversight of struggling mortgage buyers Fannie Mae and Freddie Mac.
http://www.google.com/hostednews/ap/article/ALeqM5joYzNEYzAkjJHDcG5NPFmn0Sb7vgD99KSU9O4
Phil, if I recall correctly Fannie Mae was a government chartered public [i.e. private] corporation when it collapsed last year and the administration took it over. How would reverting to what made the mess in the first place, fix it?
You’re right, Ken, but it carried with it the implicit guarantee of the government, which all market participants understood. It, therefore, can’t truly be called public.
Phil, we also saw, beginning last year that even “public” corporations have the implicit guarantee of the government–so long as they are “too big to fail”.
Gosh…the administration is doing such a good job with this program, we should let them run health care!