The regulations Bush wanted on Freddy mac

Discussion in 'Education' started by Truthmatters, Mar 27, 2009.

  1. Truthmatters
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    http://www.nytimes.com/2003/09/11/b...annie-mae.html?scp=1&sq="barney+frank"&st=nyt


    The administration's proposal, which was endorsed in large part today by Fannie Mae and Freddie Mac, would not repeal the significant government subsidies granted to the two companies. And it does not alter the implicit guarantee that Washington will bail the companies out if they run into financial difficulty; that perception enables them to issue debt at significantly lower rates than their competitors. Nor would it remove the companies' exemptions from taxes and antifraud provisions of federal securities laws.
     
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    Last edited: Mar 27, 2009
  2. Indiana Oracle
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    Indiana Oracle The Truth is Hard to Find

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    link appears to be for subscribers
     
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    try again
     
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    Freddy_Mac

    In 2003, Freddie Mac revealed that it had understated earnings by almost $5 billion, one of the largest corporate restatements in U.S. history. As a result, in November, it was fined $125 million--an amount called "peanuts" by Forbes. [4]

    On April 18, 2006 Freddie Mac was fined $3.8 million, by far the largest amount ever assessed by the Federal Election Commission, as a result of illegal campaign contributions. Freddie Mac was accused of illegally using corporate resources between 2000 and 2003 for 85 fundraisers that collected about $1.7 million for federal candidates. Much of the illegal fund raising benefited members of the House Financial Services Committee, a panel whose decisions can affect Freddie Mac. Notably, Freddie Mac held more than 40 fundraisers for House Financial Services Chairman Michael Oxley, R-Ohio


    They were trying to buy just the regulartory body they wanted.
     
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    So I proved to you Barney was right , not only was FM fine in sept 2003 but the whole reason they were talking about them is they had UNDER reported their earnings by 5 bil.

    Bush wanted to take the oversight from the banking committee and make a new regulartory angency to watch them, This is just want FM wanted and they were in trouble years later for illegally supporting R candidates who ran the banking commitee.

    The Frank story has crumbled under the facts.
     
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    I know , I know dont cry the right will make you up a new story soon.
     
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    I knew you wouldnt touch this one.

    The facts are just to stuborn huh?
     
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  9. American Horse
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    American Horse AKA "Mustang"

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    Truth, this went to the heart of the problem. Congress was doing nothing but promote the activities of F&F. This was an effort to supervise their activities because Congress either wasn't up to the task or was the beneficiary of too much in campaign donations. It was an incestuous relationship. This would've put the regulatory supervision of F&F under the Executive Department which would've then been subject to congressional oversight. Furthermore, this was exactly what I understood to be asked for by Bush from my own WSJ source at that time.

    Thanks for the link, however it doesn't seem to do what you had in mind.

    Quote from the NYT article: The new agency would have the authority, which now rests with Congress, to set one of the two capital-reserve requirements for the companies. It would exercise authority over any new lines of business. And it would determine whether the two are adequately managing the risks of their ballooning portfolios.

    The plan is an acknowledgment by the administration that oversight of Fannie Mae and Freddie Mac -- which together have issued more than $1.5 trillion in outstanding debt -- is broken. A report by outside investigators in July concluded that Freddie Mac manipulated its accounting to mislead investors, and critics have said Fannie Mae does not adequately hedge against rising interest rates.

    ''There is a general recognition that the supervisory system for housing-related government-sponsored enterprises neither has the tools, nor the stature, to deal effectively with the current size, complexity and importance of these enterprises,'' Treasury Secretary John W. Snow told the House Financial Services Committee in an appearance with Housing Secretary Mel Martinez, who also backed the plan.

    Mr. Snow said that Congress should eliminate the power of the president to appoint directors to the companies, a sign that the administration is less concerned about the perks of patronage than it is about the potential political problems associated with any new difficulties arising at the companies.

    The administration's proposal, which was endorsed in large part today by Fannie Mae and Freddie Mac, would not repeal the significant government subsidies granted to the two companies. And it does not alter the implicit guarantee that Washington will bail the companies out if they run into financial difficulty; that perception enables them to issue debt at significantly lower rates than their competitors. Nor would it remove the companies' exemptions from taxes and antifraud provisions of federal securities laws.

    The proposal is the opening act in one of the biggest and most significant lobbying battles of the Congressional session.
     
    Last edited: Mar 27, 2009
  10. Truthmatters
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    USATODAY.com

    FM issued 16% fewer SP in the 2002-2003 year.
     

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