Freddie & Fannie: Central Planning at its worst

[Mr. Peepers]

So, your saying that once the government contracts anyone to provide a service, then the govenment is absolved of any responsibility for the quality and quantity of the service.

Um, do you control your contractor in their business workings when you hire them? No, you don't - you fire him and hire a new one if you don't like him. If Freddie and Frannie were still government entities, do you really think this shit would have gone down? No, of course not. Besides, I thought you were against all government meddling in private enterprise. Hell, you guys want to deregulate everything. This is what happens when you deregulate industries vital to the health of the economy of the whole country. Remember what happened to California when they deregulated their energy policy? They got taken by Enron for 30 billion dollars. Well, we got taken by the private sector too.

 

[KissMy]

See Housing price chart. The prices shot up in 1997 due to Clintons Fannie/Freddie lowered credit standards & CRA enforcement. That was 2 years prior to deregulation. Deregulation allowed these already ticking time bomb risky assets to be sold to other countries & banks causing the contagion to spread world wide. Deregulation was not the prime cause it just added fuel to the fire.

Had we been properly regulated in the first place, the no-income ARM jumbo loan nonsense would have never existed. Had the regulation barring banks from even participating in the kind of shenanigans that went on, this would have never happened. In the end, deregulation somewhere had everything to do with the subprime meltdown. Dereglation and greed.

Greed is always a constant. The game changer was Government lowering credit standards backing risky loans allowing bankers to make more money by lending to a whole new segment of the population that anyone lending their own money would never do. The new game was sign up as many suckers as you can for a loan & get paid huge commissions & fees. Who cares it is not your money you are lending. The deregulation arm loans just increased tools, efficiency & spread the risk.

 

[Samson]

So, your saying that once the government contracts anyone to provide a service, then the govenment is absolved of any responsibility for the quality and quantity of the service.

Um, do you control your contractor in their business workings when you hire them? No, you don't - you fire him and hire a new one if you don't like him. If Freddie and Frannie were still government entities, do you really think this shit would have gone down? No, of course not. Besides, I thought you were against all government meddling in private enterprise. Hell, you guys want to deregulate everything. This is what happens when you deregulate industries vital to the health of the economy of the whole country. Remember what happened to California when they deregulated their energy policy? They got taken by Enron for 30 billion dollars. Well, we got taken by the private sector too.

So, government created businesses are an example of deregulation, Are privately created enterprises examples of regulated businesses?

And Freddy Mac has been a healthy enterprise for the past decade, and evidence of this good health is the fact that congress hasn't "fired" Freddy?

What if I have a contractor that totally fucks up, but I never check their work? Then whose fault is it when the shit hits the fan?

 

[Mr. Peepers]

So, government created businesses are an example of deregulation, Are privately created enterprises examples of regulated businesses?

And Freddy Mac has been a healthy enterprise for the past decade, and evidence of this good health is the fact that congress hasn't "fired" Freddy?

What if I have a contractor that totally fucks up, but I never check their work? Then whose fault is it when the shit hits the fan?

Well, if the SEC had been doing their JOBS instead of giving bj's to big business, maybe they wouldn't have looked the other way. With private corporations, they are always going to try to throw as much shit at the fan as they can, legal or not - which is why we must have good regulation. We should never have privatized freddie or frannie to begin with. Had they remained under government control, I doubt very seriously they would have taken the risk. This was a private corp. that knew the American taxpayers had their back - not a good combination. In fact, ALL of the big banks knew that our government couldn't let them fail because if they did, they would take down not only this country's economy in less than a week, but the whole WORLD'S economy. They knew this. Wish we had known this...

 

[Mr. Peepers]

So, government created businesses are an example of deregulation, Are privately created enterprises examples of regulated businesses?

Yes, they are private corporations, they no longer work directly for us, the American people, and they are now for-profit. That's what privatization is. And yes, most private enterprise - especially one as important as banking - should be regulated and closely watched by government watchdogs to protect the American people.

 

[CrusaderFrank]

How does the government not control an enterprise that it sponsors?

Fannie and Freddie are CONTRACTED by the government to provide a specific service - they are private corporations. They are regulated by the SEC like any other securities trader, but the government does not COTROL anything in day to day corporate decisions - at least not until the bailout.

LOL!

You rube! You total Rube!

They didn't report like any other NYSE company because they were quasi-governmental entities and they hid their losses until the accounting "scandal" (I still don't know how business as usual is a "Scandal" but whatever)

In 2010, we no longer need the government to buy mortgages. Adios! See ya!

Consolidate and sell them! Ciao!

Bye!

 

[The Rabbi]

How does the government not control an enterprise that it sponsors?

Fannie and Freddie are CONTRACTED by the government to provide a specific service - they are private corporations. They are regulated by the SEC like any other securities trader, but the government does not COTROL anything in day to day corporate decisions - at least not until the bailout.

You call people stupid and you don't know the first thing of what you're talking about? Hello?
They are not regulated by the SEC. They were regulated by OFHEO:
Office of Federal Housing Enterprise Oversight - Wikipedia, the free encyclopedia
Them and succeeding organizations.
Tell me, which private corporations have their own government agency set up specifically for them?
You are an ignorant loser of galactic proportions.

 

[CrusaderFrank]

How does the government not control an enterprise that it sponsors?

Fannie and Freddie are CONTRACTED by the government to provide a specific service - they are private corporations. They are regulated by the SEC like any other securities trader, but the government does not COTROL anything in day to day corporate decisions - at least not until the bailout.

You call people stupid and you don't know the first thing of what you're talking about? Hello?
They are not regulated by the SEC. They were regulated by OFHEO:
Office of Federal Housing Enterprise Oversight - Wikipedia, the free encyclopedia
Them and succeeding organizations.
Tell me, which private corporations have their own government agency set up specifically for them?
You are an ignorant loser of galactic proportions.

Facts always make Libs look stupid

 

[Mr. Peepers]

You call people stupid and you don't know the first thing of what you're talking about? Hello?
They are not regulated by the SEC. They were regulated by OFHEO:
Office of Federal Housing Enterprise Oversight - Wikipedia, the free encyclopedia
Them and succeeding organizations.
Tell me, which private corporations have their own government agency set up specifically for them?
You are an ignorant loser of galactic proportions.

Yes, they are moron:

Does Freddie Mac file quarterly and annual reports with the SEC?

On July 18, 2008, Freddie Mac registered its common stock with the Securities and Exchange Commission (SEC) under the Securities Exchange Act of 1934. Freddie Mac files its period financial disclosure documents with the SEC via the SEC's Electronic Data Gathering, Analysis, and Retrieval (EDGAR) system.

Prior to Freddie Mac's voluntary registration of its common stock with the SEC on July 18, 2008, Freddie Mac did not file financial reports with the SEC and instead prepared Annual Information Statements and Quarterly Information Statement Supplements in lieu of Forms 10-K and 10-Q, respectively, which are available from the company's Investor Relations Department or on-line at Freddie Mac's website.

http://www.freddiemac.com/investors/faq.html

 

[The Rabbi]

You call people stupid and you don't know the first thing of what you're talking about? Hello?
They are not regulated by the SEC. They were regulated by OFHEO:
Office of Federal Housing Enterprise Oversight - Wikipedia, the free encyclopedia
Them and succeeding organizations.
Tell me, which private corporations have their own government agency set up specifically for them?
You are an ignorant loser of galactic proportions.

Yes, they are moron:

Does Freddie Mac file quarterly and annual reports with the SEC?

On July 18, 2008, Freddie Mac registered its common stock with the Securities and Exchange Commission (SEC) under the Securities Exchange Act of 1934. Freddie Mac files its period financial disclosure documents with the SEC via the SEC's Electronic Data Gathering, Analysis, and Retrieval (EDGAR) system.

Prior to Freddie Mac's voluntary registration of its common stock with the SEC on July 18, 2008, Freddie Mac did not file financial reports with the SEC and instead prepared Annual Information Statements and Quarterly Information Statement Supplements in lieu of Forms 10-K and 10-Q, respectively, which are available from the company's Investor Relations Department or on-line at Freddie Mac's website.

Freddie Mac Investor Frequently Asked Questions

As a publicly traded company their securities were under SEC oversight. But the company was not.
Listen, why not just fess up that you screwed up and posted shit you know nothing about? We all do it on occasion and the rest of us will have more respect for you than if you wiggle-waggle trying to invent some scenario that will make you look good.

 

[Oddball]

Um, idiot. The "free market" shenanigans of lenders and wall street are what got us AND Frannie/Freddie into this mess. They were among the last to loosen lending requirements, remember? Oh, and 86%+ of toxic mortgages were issued and owned by PRIVATE LENDERS. You guys really do have the memory of a gnat. Free markets DON'T WORK WITHOUT REGULATION. The private sector cannot be trusted to police themselves. This has been proven time and time and time again.

Central planning my ass. Freddie and Frannie are PRIVATE corporations contracted by the government.

Fannie/Freddie in and of themselves are the antithesis of free market banking institutions.

You've met the idiot here, and that idiot is in your mirror.

 

[KissMy]

Facts always make Libs look stupid

Oh, look the democrat just go hit with the truth!

 

[KissMy]

Democrats Congressional Black Cacus prevented Fannie Freddie regulator OFEHO from regulating. Here is Barney Franks letter to cut funding for OFHEO because they blew the whistle on Subprime criminal activity at Fannie Mae.

[ame="http://www.youtube.com/watch?v=_MGT_cSi7Rs&feature=related"]Democrat Congressional Black Cacus prevented Fannie Freddie regulator OFEHO from regulating[/ame]

 

[boedicca]

They were under-regulated, like the rest of the mortgage business. We've been trying to tell you that.

Pay attention.

No. Regulations were manipulated for FM/FM's and their political sponsors benefit.

Yet another example of bad regulation being blamed on free markets.

 

[GHook93]

bankers and real estate agents like it, the rest of us are stuck with the tab.
Central planning just doesn't work as well as free markets.

Bankers used to like them, until they artificially fucked the market and helping bankrupt the banks.

Real Estate agents used to like them until they help create the mortgage meltdown knocking many REAs out of the business!

 

[Gadawg73]

So, you're saying that Congress, having nothing to do with Fannie and Freddie, was FORCED by "begging lenders" to allow more loaning.



Poor, Innocent Federal Government.

Samson, the right wing myth is that government forced the banks to loan more.
The banks made a lot of $$ loaning money, and that is great, so why would ANY entity have to force anyone to make $$?
Most of my work is as a consultant to the banks. No one forced any bank to loan any real $ that caused the financial crisis. No government program forced any bank to loan 650K to someone. That never happened. Baloney myth.
Banks, not government, loan $ and they loved doing so.
So please inform us why the government DID NOT force the banks to continue those loans when the shit hit the fan. How come that never happened?
Because government never forced banks to make over 90% of those loans to begin with.

I agree, it is a "right wing myth" that banks were "forced" to lend.

However, it is equally false to say that regulators were simply innocent by-standers, or that Congress was "forced" to appease lenders "begging for lending opportunities.

Are there any Adults in Accountable for their actions?

Apparently not.

You are on the right course.
It is and was not the fault of any government employee,program, law, regulation, rule, Barney Frank, Phil Gramm or whoever that adults did not pay their mortgages.
How ironic it is that the very peoplethat claim they are conservative here blame the government for folks that are deadbeats and do not pay their bills.

 

[Samson]

Samson, the right wing myth is that government forced the banks to loan more.
The banks made a lot of $$ loaning money, and that is great, so why would ANY entity have to force anyone to make $$?
Most of my work is as a consultant to the banks. No one forced any bank to loan any real $ that caused the financial crisis. No government program forced any bank to loan 650K to someone. That never happened. Baloney myth.
Banks, not government, loan $ and they loved doing so.
So please inform us why the government DID NOT force the banks to continue those loans when the shit hit the fan. How come that never happened?
Because government never forced banks to make over 90% of those loans to begin with.

I agree, it is a "right wing myth" that banks were "forced" to lend.

However, it is equally false to say that regulators were simply innocent by-standers, or that Congress was "forced" to appease lenders "begging for lending opportunities.

Are there any Adults in Accountable for their actions?

Apparently not.

You are on the right course.
It is and was not the fault of any government employee,program, law, regulation, rule, Barney Frank, Phil Gramm or whoever that adults did not pay their mortgages.
How ironic it is that the very peoplethat claim they are conservative here blame the government for folks that are deadbeats and do not pay their bills.

I'm not saying there are not deadbeats.

But, if I lend $20.00 to a hamster, and it doesn't pay me back, the default on the loan isn't the hamster's fault.

 

[edthecynic]

They were under-regulated, like the rest of the mortgage business. We've been trying to tell you that.

Pay attention.

I recall reading article after article in WSJ, raising red flags over Freddie and Fanny between 2001-2002.

When Bush was President.

Yes........


BOOOOOOOOOOOOOOOOOOOOoooooooooOOOOOSH

Fannie and Freddie may have been on the edge in 2001 and 2002, but it was Bush's dec 2003 American Dream Downpayment Initiative (ADDI) that changed the rules and pushed the housing market over the cliff.

The American Dream Downpayment Initiative allowed no downpayment loans to people with bad credit for more than the house was worth and who were at least 20% below the standard for the neighborhood who would never be able to make their payments. Bush did it to try to strip minority votes away from the Dems. It was the centerpiece of his 2004 campaign.

American Dream Downpayment Initiative - Affordable Housing - CPD - HUD
American Dream Downpayment Initiative
Summary

The American Dream Downpayment Initiative (ADDI) was signed into law on December 16, 2003. The American Dream Downpayment Assistance Act authorizes up to $200 million annually for fiscal years 2004 - 2007. ADDI will provide funds to all fifty states and to local participating jurisdictions that have a population of at least 150,000 or will receive an allocation of at least $50,000 under the ADDI formula. ADDI will be administered as a part of the HOME Investment Partnerships Program, a formula grant program.

Purpose

ADDI aims to increase the homeownership rate, especially among lower income and minority households, and to revitalize and stabilize communities. ADDI will help first-time homebuyers with the biggest hurdle to homeownership: downpayment and closing costs. The program was created to assist low-income first-time homebuyers in purchasing single-family homes by providing funds for downpayment, closing costs, and rehabilitation carried out in conjunction with the assisted home purchase.

Type of Assistance

ADDI will provide downpayment, closing costs, and rehabilitation assistance to eligible individuals. The amount of ADDI assistance provided may not exceed $10,000 or six percent of the purchase price of the home, whichever is greater. The rehabilitation must be completed within one year of the home purchase. Rehabilitation may include, but is not limited to, the reduction of lead paint hazards and the remediation of other home health hazards.

Eligible Customers

To be eligible for ADDI assistance, individuals must be first-time homebuyers interested in purchasing single family housing. A first-time homebuyer is defined as an individual and his or her spouse who have not owned a home during the three-year period prior to the purchase of a home with ADDI assistance. ADDI funds may be used to purchase one- to four- family housing, condominium unit, cooperative unit, or manufactured housing. Additionally, individuals who qualify for ADDI assistance must have incomes not exceeding 80% of area median income.

Eligible Activities

ADDI funds may be used for downpayment, closing costs and, if necessary, rehabilitation in conjunction with home purchase. ADDI funds used for rehabilitation may not exceed twenty percent of the participating jurisdiction's total ADDI allocation. The rehabilitation assisted with ADDI funds must be completed within one year of the home purchase.

Funding Status

In FY 2007, Congress appropriated $24,750,000 for ADDI. Previously, Congress appropriated $74,513,000 in FY2003 and $86,984 in FY2004, $49,600,000 in FY2005 and $24,750,000 in FY2006. HUD has issued formula allocations for FY 2007 to assist participating jurisdictions in preparing their consolidated plans.

Obtaining Assistance

First, check the formula allocation page to determine whether your local HOME administering agency received ADDI funding. If they did not receive ADDI funding, ADDI funds may be available through your state. Every state received ADDI funds. The contacts for state are available in the HOME administering agency list.

USATODAY.com - Bush seeks to increase minority homeownership

Bush seeks to increase minority homeownership
By Thomas A. Fogarty, USA TODAY

In a bid to boost minority homeownership, President Bush will ask Congress for authority to eliminate the down-payment requirement for Federal Housing Administration loans.

In announcing the plan Monday at a home builders show in Las Vegas, Federal Housing Commissioner John Weicher called the proposal the "most significant FHA initiative in more than a decade." It would lead to 150,000 first-time owners annually, he said.

Nothing-down options are available on the private mortgage market, but, in general, they require the borrower to have pristine credit. Bush's proposed change would extend the nothing-down option to borrowers with blemished credit.

The FHA isn't a direct lender, but guarantees loan payments for mortgages on moderately priced owner-occupied property. The FHA guarantee now permits private lenders to finance as much as 97% of the purchase price of a home for millions of low- and middle-income borrowers.

In the proposal soon to be delivered to Congress, Bush would allow the FHA to guarantee loans for the full purchase price of the home, plus down-payment costs. As a practical matter, the FHA would guarantee mortgages as high as 103% of the value of the underlying property.

 

[Oddball]

Never would've flown for as short a time as it did if Fannie/Freddie didn't exist.

 

[Gadawg73]

I agree, it is a "right wing myth" that banks were "forced" to lend.

However, it is equally false to say that regulators were simply innocent by-standers, or that Congress was "forced" to appease lenders "begging for lending opportunities.

Are there any Adults in Accountable for their actions?

Apparently not.

You are on the right course.
It is and was not the fault of any government employee,program, law, regulation, rule, Barney Frank, Phil Gramm or whoever that adults did not pay their mortgages.
How ironic it is that the very peoplethat claim they are conservative here blame the government for folks that are deadbeats and do not pay their bills.

I'm not saying there are not deadbeats.

But, if I lend $20.00 to a hamster, and it doesn't pay me back, the default on the loan isn't the hamster's fault.

And not the governments fault either.