Moochacha

Ticking Prime Bomb: Fannie Mae Monthly Summary, September 2009

If they should break up Fannie and Freddie then they should also break up the big banks that got bailouts. There was certainly more than a whiff of moral hazard, since they should have well known that the junk they were creating would eventually be a house of cards.

A few details you forgot to mention is that Fannie and Freddie have been buying up qualified MSB's (Mortgage Backed Securities) from the banks who created the toxic brew to begin with.

The banks got bailout money because of a self made crisis, they were too big to fail remember. Now they want Fannie and Freddie to break up, since they have cleaned up the paper they have bought from the banks, and they can all have a share.


On Nov 07 12:47 AM Moon Kil Woong wrote:

> Fannie Mae, Freddie Mac, FHA, and Ginnie Mae account for 90+% of
> the sub jumbo market. They already own the whole market lock stock
> and smoking barrel. Sadly, they own them at a loss and the taxpayer
> will be billed regularly. Even so, they continue to write these and
> buy bad mortgage bonds from the banks at the urging of the administration.
>
>
> The simple answer is to break them up and strip away government protection.
> Of course, that would mean that their loans would have to go up to
> account for real risk like forclosures and defaults rather than sitting
> at 5.5%. Although this would be bad for the housing market it wouldn't
> neccesitate taxpayer funding and asking the Treasury and Fereal Reserve
> to print even more money to buy their bonds merely so they can issue
> even more of the toxic garbage.
>
> The bailout continues. It's just been morphed into something that
> doesn't need a vote by cowardly politicians which have delegated
> away their powers and burned the US Constitution.

Ticking Prime Bomb: Fannie Mae Monthly Summary, September 2009

It does look scary the way this is presented but you might consider the considerable undertaking to modify mortgages and help homeowners that are facing foreclosure which is now mainly being done by FRE and FNM. The banks and other mortgage holders are holding tight to their toxic assets however.

Accounting for Losses at BofA and Fannie

"But to be fair, Hempton actually thinks that Bank of America is being only slightly optimistic and Fannie is being extremely pessimistic"

I'd place my bets on the company that is not overstating things, since that\s really what got us (the economy) into trouble.

Financial Regulation: How Would You Have It Work?

Suggestions:
mortgages be held by the banks or companies that write them, and they would be more careful of who they lend to, but instead they prefer to take a "hair cut" and sell the mortgages in packages to investors or other mortage lenders.

Ratings on Mortgage backed securities should be done by companies by looking at the actual mortages and should be insured, not swapped.

Servicers who process payments should not get fees when mortgages are in default and should be accessible by the holders of the mortgages, etc. as well as the mortgagees. Preferably the mortgage lenders should also be the holders and servicers.

The New Economy and Canadian Housing's Bubble Status

The concept of a housing bubble is a bit foreign to Canadians to begin with. How can there be a housing bubble when many people don\t own there own home, and people who have a home are losing them? Irresponsible lending?

In the U.S. where foreclosures are rising, the real reason that many of these are taking place is because people signed up for ARM's (adjustable rate mortgages that really didnt benefit them, but were extremely beneficial to companies such as Countrywide, who were able to securitize them and make a killing. The states where the housing crisis is the worst is exactly where these so called subprime mortgage companies operated.

People applying for mortgages to these companies were often
simply misinformed that they would get 1/4 percent savings if they chose this mortgage over the regular mortgage according to there accounts. This was an arbitrage play by these subprime vultures who profitted when they were able to securitize these mortgages, and package them with higher rated mortgages. With all the investig tions by congress etc they dropped the ball on this. I am not sure but I think there may be some court cases regarding this.

The subprime mortgage companies have not gained ground in Canada because these subprime companies and the infrastructure of the derivitive markets are not fostered by the banking system in the US.

Affordable housing through economic stimulus is taking a bum rap for the excesses of greedy bankers in my opinion.

GE to Participate in World’s Biggest Carbon Capture Project

Keithfeather, there is more to consider than the weight of the waste, would you like to have that 1 pound of radioactive waste sitting in your yard. I dont kinow if you realize it but you would be dead in no time from radiation poisoning. The disposal of radioactive waste is a problem that has not been solved, although the waste has been buried, in remote areas, or stored in storage tanks, the storage tanks are only safe for a hundred years or so, and the remote areas are hazardous for the life of the waste which is millions of years. There is a large amount of nuclear waste waiting in temporary storage for a solution to be found. Nuclear vs Coal is like choosing your poison. Another ananlogy might behaving a duel and choosing pistols or swords, you still get killed.

Who Were the Winners on Interest-Rate Swaps?

Interesting point on L. Summers.

Maybe the only ones that can clean up this mess are the ones who made it, eg AIG had to pay million dollar bonuses to employees who are unwinding the swaps they created because no one else knows how to.

You have given Obama an unfair shake by saying he is corrupt I think he is a smart guy trying to deal with bankers from hell.

GE to Participate in World’s Biggest Carbon Capture Project

Methyl hydrates found under the ocean which are plentiful and already compressed. Why then would they want to release the natural gas and then compress it?

Fed Exit Strategy: Can Stocks Survive the Bailout Party Hangover?

AIG shares are up almost $6, on the news that the company is proposing the government restructure their loans and lower interest rates etc. This is the company at the heart of the financial crisis. The world has been patient but there is no remorse.

Barrick’s Secondary Offering to Buy Them Out of Bad Hedging

Dumb question but if Barrick is buying is there someone selling, and could this drive up the price?

Marijuana, LSD, Cocaine Now Legal in Mexico. Will the Economy Benefit?

Since most of the drugs end up in the US and other rich (developed) countries, maybe this idea is worth thinking about. The drug cartels are making their money from smuggling, not from people in mexico. If they can reduce the power of the drug cartels in Mexico this country will be better off economically, reducing poverty and crime.

Natural Gas ETF Premium Reaches 20%: Time to Unload?

If natural gas is currently trading at record lows then why would the CTFC be concerned about more demand, i.e. UNG issuing more shares? ETN's buying more contracts is certainly not what has driven the price of natural gas down. If they are concerned it seems more likely they would be concerned about what might possilbly be driving prices down artificially, is the increased volume due to selling or buying? So is there any possibility of a short squeeze, hmmm. Don't know but I don\t think prices can go much lower so I am long GAZ.

Citibank's Best Customer: The U.S. Government

Seems like there aret so many shares out there I am wondering if the government got any value when it traded its preferred shares for common shares. To make matters worse now that C apparently will be issuing warrants for more preferred shares (only government entities cannot excercise them according to an advisory) will the government be singing Dubai, Dubai Doo, Doo, Doo.Doo Doo Doo?

Fannie Mae: Trading Derivatives...and Losing

If they break up FNM as being talked about, will Goldman be the beneficiary maybe?

CIT Stopped... Again

im NOT