whtamess

Pathetic Display at Yesterday's Financial Hearings

my comment was intended for "markhead"

Pathetic Display at Yesterday's Financial Hearings

Obviously you have not done your homework and you know NOT of what you speak. Fannie Mae met every stress test had 40 billion in capital and should not have been taken over... I can't speak for Freddie Mac. If you understand a mortage as an instrument on the financial market it performs as long as people make their payment. Due to Mark to Market accounting rules (go to FASB web site and review Fas number 157) banks and the GSE's were required to record losses when people continued to make payments. This was one huge part of the problem... when you consistantly have to take a loss when the reality is the instrument is still performing is a bunch of hooey. The gov't doesn't have to conform to this FASB rule and can make money hand over fist and it was stated by a Senator that this was a way to pay the taxpayers back on the bailout. What is good for one should be good for all. We wouldn't be in this position if that rule didn't exist. There are some financial instuments that a rule like that would be correct for however a mortgage is not one of them.

How Much Are Fannie and Freddie to Blame?

Dear Realist,
Did you ever hear of Mark to Market accounting... the gov't doesn't have to abide by it Fannie and Freddie did. You want the culprit to this fiasco look at the Financial Accounting Standards Board site and review the rules and if you have any idea at all about accounting rules you will begin to understand a portion of what happened here. I found it interesting to hear a Senator mention on the news that the govt doesn't have to abide by these rules and therefore they will be in a position to make money and protect the taxpayers for this rescue plan.
And yet another reason for the mess. From an article..." Andrew Cuomo and Fannie and Freddie
How the youngest Housing and Urban Development secretary in history gave birth to the mortgage crisis
By Wayne Barrett"
published: August 05, 2008
and I quote "Andrew Cuomo, the youngest Housing and Urban Development secretary in history, made a series of decisions between 1997 and 2001 that gave birth to the country's current crisis. He took actions that—in combination with many other factors—helped plunge Fannie and Freddie into the subprime markets without putting in place the means to monitor their increasingly risky investments. He turned the Federal Housing Administration mortgage program into a sweetheart lender with sky-high loan ceilings and no money down, and he legalized what a federal judge has branded "kickbacks" to brokers that have fueled the sale of overpriced and unsupportable loans. Three to four million families are now facing foreclosure, and Cuomo is one of the reasons why." here is the link for the article www.villagevoice.com/c...

Feddie Pay: The Reality of the Bailout World

madasiwannabe- you have it correct however the man is so protected by his new position that no one will do anything to stop his mass destruction and his mass paycheck for doing what he has done.

Paulson Should Remain Treasurer Through the Elections

hey bearfund a revolt, can I join?

Paulson Should Remain Treasurer Through the Elections

Not in the least... are you keeping up on your reading? So many articles are now covering this topic. The conversations at the dinner table are humming with this topic as well. Many of my colleagues are enjoying some healthy debates (non-emotional) and the outcomes are rather informative.
I would add I have gone out of way to read a great deal of information past and present to provide a stronger understanding of this situation prior to coming to my conclusion. I hope you have done the same. These are interesting and frightening times when understanding the freedoms that were provided to us are protected from government intervention

Paulson Should Remain Treasurer Through the Elections

He and his cronies have become the face of socialism in America... I don't think so

The Fannie/Freddie Bailout: Consequences to the U.S. Taxpayer

Chris B. I asked for the opportunity to better understand this whole mess... you have become my educator, I finally get it; all of it. I think I am afraid now more than ever. That is a good thing and I think more people should take the time to read, read, and then read some more. Being uneducated about what really is going on is on is no excuse. There will be a time when we have to step up and we need to do so with a good understanding of what we are in the midst of under our belt. You rock!

Welcome to the Mortgage Business

john1... what does this have to do with anything? AS hard as I am trying to understand all of this maybe you should too instead of making such hard nosed statements. At least I am doing some homework.

The Fed - A True Haven for Capitalism?

Chis B. I couldn't have said it any better. You hit the nail on the right smack on the head. America wake up.

The Fannie/Freddie Nationalization: Conservatives Acting Like Socialists

Conservatives Acting Like Socialists...Halleluja... brother.

Welcome to the Mortgage Business

As I read further: And I wonder why I end up pondering the way I do. Maybe my thoughts aren't so whacky after all. I'm going to stop reading the news now.

Why the Panic over Fannie and Freddie?
by: Bill Cara posted on: September 07, 2008 | about stocks: FNM / FRE Font Size: PrintEmail [The following is excerpted from Bill Cara's Daily Report from Saturday, Sept. 6, 2008]

After the US Jobs data was published Friday at 8:30am ET, the DJIA futures sank and the market continued south for two hours. Suddenly – maybe it was a leak that Fannie (FNM) and Freddie (FRE) would be saved by this Administration – US equity prices firmed.

Whatever is happening with Fannie and Freddie seems to me to be a well-crafted maneuver by Washington insiders (Mr. Moral Hazard instantly comes to mind) to help Wall Street in the remaining days of this Administration. Oh sure there will be cries by panic-stricken investors that Fannie and Freddie are on the verge of collapse and that this single problem is the source of America’s economic and financial stress (i.e., simultaneous economic recession and credit crunch) at the moment. But, as I see it, the ‘Blame it on Fannie & Freddie’ story is being scripted by public relations propagandist of the first order, Hill & Knowlton. Let’s just say for the record that the Boards of Directors and CEOs of Fannie & Freddie have quite recently publicly announced that their enterprises have adequate capital to sustain operations until well past the coming change of Administration. Then, why the panic?

What is wrong with America – the greed and gluttony of Wall Street and Washington insiders – will look like smack-mouth football in the next month, and the central characters behind it won’t give a damn. This is wrong – they know it; you know it.

The fact there is nothing you can do about it – to the detriment of your children and their children – is a tragedy. The decisions made in September and October by your elected representatives – societal leeches of the highest order -- will steal the wealth created by a whole generation of Americans.

PIMCO, the Fed of NY, the Treasury Secretary – oh my! Mom & Pop, you have been set up for a fleecing.

Yes, these are interesting times.

Welcome to the Mortgage Business

Call me crazy but this whole thing scares the b-jesus out of me.
Here are the facts that I know, well I guess I think I know them based on media representation; Fannie Mae met all of the requirements that were set for them and the regulators released them several months ago. This was after arduous audits and reviews. Freddie on the other hand did not and has demonstrated its inability to pass any of the stress tests. So with that we have one GSE that was in good shape and one that was not. Does this mean that you take them both down? I did however read that they were both currently profitable.
Here is one article I am talking about: Fannie, Freddie Mortgage Profit Reaches 10-Year High
Bloomberg (08/27/08); Shenn, Jody
Citigroup Inc. reports a yield of approximately 40 basis points on current-coupon mortgage bonds bought by Fannie Mae and Freddie Mac, surpassing the amount they pay to borrow by unloading benchmark bonds. Net interest income recorded by Fannie Mae surged to $2.1 billion in the second quarter from $1.7 billion in the first quarter, according to Credit Suisse Group, with investment profits rising to 100 basis points from 82 basis points. Meanwhile, Freddie Mac posted a 92-percent jump in net interest income to $1.5 billion, with investment profits increasing to 80 basis points from 48 basis points. According to Loomis Sayles & Co. Vice Chairman Dan Fuss, "They, at the increment, are very, very profitable. If they can continue to do anything close to business as usual, they are immensely profitable.

This gets very confusing for the average Joe like me. You read this and then you see the action taken. What concerns me as well is the government now in essence having ownership of a huge piece of the mortgage market (yes I know they are calling this a conservatorship) is this really one step in a socialistic form of government? Things like eminent domain come to mind. Maybe a crazy thought but you know crazier things have happened lately.

Why was Fannie Mae included in this debacle when they clearly met all of the requirements? I'm just really trying to understand this. To repeat myself I get the whole Freddie Mac piece. There are just too many actions here that make me wonder out loud. Is this another George Bush "Weapons of Mass Destruction" ploy to get the government involved in something they shouldn't be? These are simply questions that have started to cross my mind. I am completely open to comments that help educate me because as it stands and from what I read from the onset of this issue up and until today all I can get is “beware” this is just the beginning of yet another government intervention going to go wrong. Thank you for any insight you might care to share.

The True Nature of Fan and Fred

You know that "report abuse" button on the bottom of each commentary... that should be at the bottom of the article. Mr. Tan is completely out of line and borders in the range of flunking on this paper.

Fannie and Freddie Are Largely Responsible for the Housing Bubble

What a bunch of CRAP... obviously you have no idea how a bank lends money. If it weren't for these GSE's there would have been no money to lend to people to buy homes... they would have run out of money you moron. They created liquidity so banks could continue to lend and people could buy homes at reasonable rates.

What happened here was some nitwit coming up with accounting rules that caused so many asset problems and people like this that write articles that downgrade the stock that in turn puts a crack in market and affects our dollar nationally and internationally.