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Old 07-19-2008, 06:41 PM
BlueAngel BlueAngel is offline
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Join Date: May 2007
Posts: 10,799
Default Re: Creating Poverty and a Third World Country

Well, actually, the government helped with the rut that Fannie Mae and Freddie Mac now face because both entities have access to a line of credit from the US Treasury which is a part of the Federal Reserve.

Both Fannie and Freddie are protected financially by the support of the US government.

They hold more than 90 percent of the country's secondary mortgage market.

They lend money to the FED banks and the banks, in turn, made bad loans.

This causes debt on both ends.

They knew what the outcome would be.

They're all connected.

What Are the Origins of Freddie Mac and Fannie Mae?

Excerpt:

In recent months, the nation's two largest mortgage finance lenders have come under increasing scrutiny at the hands of Congress, the Justice Department and the Securities and Exchange Commission (SEC). The Federal National Mortgage Association, nicknamed Fannie Mae, and the Federal Home Mortgage Corporation, nicknamed Freddie Mac, have operated since 1968 as government sponsored enterprises (GSEs). This means that, although the two companies are privately owned and operated by shareholders, they are protected financially by the support of the Federal Government. These government protections include access to a line of credit through the U.S. Treasury, exemption from state and local income taxes and exemption from SEC oversight. A recent accounting scandal at Freddie Mac that resulted in the replacement of three of the company's top executives has led to mounting concerns over the privileged status these GSEs enjoy in the marketplace.
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