The Fed is suing 17 banks for selling Fannie Mae and Freddie Mac billions of dollars worth of mortgage-backed securities that turned toxic when the housing market collapsed. To be honest they were toxic before the collapse because they were risky from the beginning. The lawsuits were filed Friday by the Federal Housing Finance Agency which oversees Fannie and Freddie, the two agencies that buy mortgages loans and mortgage securities issued by the lenders. The government didn't provide a dollar amount of how much it seeks in damages. It said that it wants to have the purchases of the securities canceled, they want to be compensated for lost principal and interest payments as well as attorney fees and costs. Home mortgage-backed securities were risky investments that collapsed after the real-estate bust and helped fuel the financial crisis in late 2008. While speaking at a Los Angeles Town Hall event recently, Rep. Maxine Waters said its up to the federal government to make sure people can afford their mortgages. So much so that its time the president bring the gangsters in, put them around the table, and let them know that if they dont come up with loan modifications and keep people in their homes, that theyve worked so hard for, were gonna tax them out of business. It's this kind of thuggish behavior that led to the collapse in the first place....and now folks like Maxine Waters are setting it up again. [ame=http://www.youtube.com/watch?v=kJbBV-Ntwic&feature=player_embedded]Maxine Waters wants Obama to use extortion - YouTube[/ame] If lending wasn't tight before just wait till all of this takes hold. I think the Democrats couldn't have done more to screw up the economy then if they tried to do it on purpose. These folks are a real joy to watch. They set up the rules, badger everyone into following them and then sue the crap out of them when it all blows up in their faces. If you were wondering why hiring is at zero and trillions of dollars is resting on the sidelines this BS is a perfect illustration of why. Nobody trusts the government these days and after all of the bullying and lawsuits who can blame them.