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WASHINGTON - The government is expected to take over Fannie Mae and Freddie Mac as soon as this weekend in a monumental move designed to protect the mortgage market from the failure of the two companies, which together hold or guarantee half of the nation's mortgage debt, a person briefed on the matter said Friday night.
Some of the details of the intervention, which could cost taxpayers billions, were not yet available, but are expected to include the departure of Fannie Mae CEO Daniel Mudd and Freddie Mac CEO Richard Syron, according to the source, who asked not to be named because the plan was yet to be announced.
Federal Reserve Chairman Ben Bernanke, Treasury Secretary Henry Paulson and James Lockhart, the companies' chief regulator, met Friday afternoon with the top executives from the mortgage companies and informed them of the government's plan to put the troubled companies into a conservatorship.
If you want to know how Fannie Mae and Freddie Mac have survived scandal and crisis, consider this: Over the past decade, they have spent nearly $200 million on lobbying and campaign contributions.
But the political tentacles of the mortgage giants extend far beyond their checkbooks.
The two government-chartered companies run a highly sophisticated lobbying operation, with deep-pocketed lobbyists in Washington and scores of local Fannie- and Freddie-sponsored homeowner groups ready to pressure lawmakers back home.
Theyve stacked their payrolls with top Washington power brokers of all political stripes, including Republican John McCains presidential campaign manager, Rick Davis;
I blame the idiot people that listened to the dumbasses that were yelling how this was the best economy ever and to go out and buy a house and all that other shit when they couldn't afford it.
"Here's your tax rebate check, it's your duty as an American to spend it on a big screen TV."
Morons.
Hmmm, Glock, missed this one.
Check out how much McCain was given. I guess it's easier to just glock Obama than be honest,
Don't glock. Tell the truth. You are such a glockhead. Suck my glock. You don't know glock. Glock off. Kiss my glock.
New Agency Proposed to Oversee Freddie Mac and Fannie Mae
By STEPHEN LABATON
The Bush administration today recommended the most significant regulatory overhaul in the housing finance industry since the savings and loan crisis a decade ago.
Under the plan, disclosed at a Congressional hearing today, a new agency would be created within the Treasury Department to assume supervision of Fannie Mae and Freddie Mac, the government-sponsored companies that are the two largest players in the mortgage lending industry.
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. ...
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 current regulator does not have the tools, or the mandate, to adequately regulate these enterprises,'' Mr. Oxley said at the hearing. ''We have seen in recent months that mismanagement and questionable accounting practices went largely unnoticed by the Office of Federal Housing Enterprise Oversight,'' the independent agency that now regulates the companies.
''These irregularities, which have been going on for several years, should have been detected earlier by the regulator,'' he added.
...
''The regulator has not only been outmanned, it has been outlobbied,'' said Representative Richard H. Baker, the Louisiana Republican who has proposed legislation similar to the administration proposal and who leads a subcommittee that oversees the companies. ''Being underfunded does not explain how a glowing report of Freddie's operations was released only hours before the managerial upheaval that followed. This is not world-class regulatory work.''
...
''These two entities -- Fannie Mae and Freddie Mac -- are not facing any kind of financial crisis,'' said Representative Barney Frank of Massachusetts, the ranking Democrat on the Financial Services Committee. ''The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing.''
Representative Melvin L. Watt, Democrat of North Carolina, agreed.
''I don't see much other than a shell game going on here, moving something from one agency to another and in the process weakening the bargaining power of poorer families and their ability to get affordable housing,'' Mr. Watt said.
Try that here.
You don't blame the lobbyists and politicians that deregulated the industry knowing this would happen? Most state attorney generals warned the Bush regime back in 2002 that the predatory lending would occur and the Federal government over rid the states that said they didn't want sub prime loans in their states.
I have to admit, you are a smart guy from what I read, and even you are under informed about what the hell the GOP did from 2000-2006 when they ran it all.
Did the Federal Reserve bail out the home owners? No they did not. So are you saying you don't blame the banks that got bailed out? You don't blame the predatory lenders that sold the loan and then sold off the loans to the bigger banks and washed their hands of the bad loans they knew would turn into bad loans.
I blame the people who gave the original loans. Countrywide and Quicken type companies.
Do you really think they were innocent?
the american dream was to own your own home..somewhere along the line...the american dream became to borrow heavily on your home. it was so encouraged by all types of interests....real estate brokers....apprasiers...bankers...etc. you had flipping shows..buy this house, flip it and make thousands...which you can do in the right market still. people counted on the continued appreciation of their homes. refinancing every time they could. Doing a few thousand worth of renovacations then getting an apprasiel upping the homes value by more than 10%. On a $250.000. home that is quite a nice sum of cash. buying large screens, atv,s , going on real nice vacations..all the while banking on future apprecaiton of their homes. Seeing their house payments inch up slowly but nothing they couldnt handle....till the bubble popped and they are now upside down with their house. They are struggling to make payments and pay expenses of daily living.
the american dream was to own your own home..somewhere along the line...the american dream became to borrow heavily on your home. it was so encouraged by all types of interests....real estate brokers....apprasiers...bankers...etc. you had flipping shows..buy this house, flip it and make thousands...which you can do in the right market still. people counted on the continued appreciation of their homes. refinancing every time they could. Doing a few thousand worth of renovacations then getting an apprasiel upping the homes value by more than 10%. On a $250.000. home that is quite a nice sum of cash. buying large screens, atv,s , going on real nice vacations..all the while banking on future apprecaiton of their homes. Seeing their house payments inch up slowly but nothing they couldnt handle....till the bubble popped and they are now upside down with their house. They are struggling to make payments and pay expenses of daily living.
