http://news.yahoo.com/s/ap/20080906/ap_on_bi_ge/mortgage_giants_crisis
i knew this was coming
so does this mean i dont have to pay my student loans back
Very convenient how you ignore that your activist government beliefs are much more consistent with the bailouts than my limited government beliefs. If it was up to me your government would never have created those companies in the first place let alone bail them out.
I already said in my previous post, if it was up to me they would not have been created, let alone bailed out. No one deserves to have the government bail them out of a bad decision made freely. That includes everyone onethought, not just corporations.
The only part that will fail is the part that is firmly intermingled with government. Good riddance.
<font size="5"><Center>
Acting head of Freddie Mac commits suicide</font size></center>
David Kellermann
WTOP
April 22, 2009 - 8:02am
RESTON, Va. -- The acting head of Freddie Mac, David Kellermann, has apparently committed suicide, Fairfax County Police tell WTOP.
Fairfax County Police spokeswoman Mary Anne Jennings says Kellermann, 41, was found at his Hunter Mill Estates home Wednesday morning.
Jennings says police responded to the home after family members called police around 5 a.m.
"We were called from inside the house to come investigate an apparent suicide," Jennings says.
Because of legal ramifications, Jennings says she can't describe the nature of the suicide.
"We're not to give you details of the condition of the body, except to say it was an apparent suicide," Jennings says.
A final determination that his death was a suicide will come from a medical examiner.
According to Freddie Mac's Web site, Kellermann has been with Freddie Mac for more than 16 years.
He was named acting director of the agency in September 2008.
(Copyright 2009 by WTOP. All Rights Reserved.)
http://www.wtop.com/?nid=600&sid=1657033
<font size="5"><Center>
Acting head of Freddie Mac commits suicide</font size></center>
David Kellermann
WTOP
April 22, 2009 - 8:02am
RESTON, Va. -- The acting head of Freddie Mac, David Kellermann, has apparently committed suicide, Fairfax County Police tell WTOP.
Fairfax County Police spokeswoman Mary Anne Jennings says Kellermann, 41, was found at his Hunter Mill Estates home Wednesday morning.
Jennings says police responded to the home after family members called police around 5 a.m.
"We were called from inside the house to come investigate an apparent suicide," Jennings says.
Because of legal ramifications, Jennings says she can't describe the nature of the suicide.
"We're not to give you details of the condition of the body, except to say it was an apparent suicide," Jennings says.
A final determination that his death was a suicide will come from a medical examiner.
According to Freddie Mac's Web site, Kellermann has been with Freddie Mac for more than 16 years.
He was named acting director of the agency in September 2008.
(Copyright 2009 by WTOP. All Rights Reserved.)
http://www.wtop.com/?nid=600&sid=1657033
You really don't give a shit as long as government looks good huh?
http://news.yahoo.com/s/ap/20080906/ap_on_bi_ge/mortgage_giants_crisis
i knew this was coming
so does this mean i dont have to pay my student loans back
<font size="6"><center>
Paulson readies the 'bazooka'</font size><font size="4">
Big buyers of Fannie Mae and Freddie Mac debt
have been shying away. The Treasury
secretary wants to coax them back.</font size></center>
Treasury Secretary Henry Paulson
CNN/Fortune
By Colin Barr, senior writer
September 6, 2008
NEW YORK (Fortune) -- It took two months, but the bond market called Henry Paulson's bluff: The Treasury Secretary was widely expected this weekend to announce a plan to take Fannie Mae and Freddie Mac under government control.
News reports say the mortgage giants will be placed under a "conservatorship" of their new regulator, the Federal Housing Finance Agency. The agency would likely temporarily run Fannie and Freddie and continue to implicitly back any liabilities until the two companies' financial standing was strengthened.
First Try to Calm the Markets
The reports come just two months after Paulson attempted to calm financial markets by pledging government support for Fannie (FNM, Fortune 500) and Freddie (FRE, Fortune 500), which were under siege by investors because of fears about their weak balance sheets.
Paulson asked Congress for the right to use taxpayer funds to intervene - but hoped the pledge alone would be sufficient. "If you have a bazooka in your pocket and people know it, you probably won't have to use it,'' he said at a July 15 Senate Banking Committee hearing.
But now Paulson is readying the bazooka, because the markets didn't respond as hoped. Shares in the companies bounced back from multiyear lows in recent weeks, but bond markets have not regained confidence in Fannie and Freddie.
The amount the companies pay to borrow in the bond market has risen sharply during the past year.
Investors Shying Away
Fannie and Freddie rely heavily on their ability to borrow money at good rates, which they use to buy mortgages from lenders - they now own or guarantee some $5 trillion in home loans.
Investors began shunning debt issued by Fannie and Freddie in favor of U.S. Treasury bonds. On Friday, yields on the 10-year Treasury note hit a five-month low at 3.55%, down a full percentage point from a year ago. This reflects greater demand for the perceived safety in Treasuries.
Foreign central banks, particularly China's, have in recent years been among the biggest buyers of "agency" bonds, those issued by Fannie, Freddie and other government entities. But they've been backing away. Brad Setser, an economist at the Council on Foreign Relations, noted last month that Federal Reserve data showed foreign central banks were, for the first time in four years, net sellers of agency bonds.
The White House and the Treasury Dept. would not comment on the reports.
When Calming Doesn't Work
A statement Saturday from the office of Barney Frank, D-Mass., confirmed that Paulson said he plans to use "the powers that Congress provided it" in a housing bill passed in July. Those powers include the Treasury lending money to Fannie and Freddie, as well as the option to buy stock. Frank added that he does know the details of the intervention.
If the banks that write mortgages to regular homebuyers can't count on Fannie and Freddie to buy their loans, they have to charge higher interest rates, tighten credit standards and demand higher downpayments - all of which is already happening and slowing a recovery in housing markets.
- Impact on home markets
Even as the Fed has slashed short-term interest rates by more than 3 percentage points over the past year, rates for 30-year fixed-rate mortgages have remained stubbornly high. They were at 6.35% last week, Freddie Mac reported, down just a sliver from 6.46% last year.
Home prices fell 7.6% in the second quarter, the National Association of Realtors reported last month.
Any move to take Fannie and Freddie under explicit government control thus amounts to another effort to restore investor confidence at the companies, and in the housing market they support.
It's unclear what the long-term role of a conservatorship would be. The government would likely temporarily run Fannie and Freddie to ensure they don't take extreme risks to right themselves. The government would gradually add funds to the entities so they can continue to buy loans. And it would continue to implicitly back their liabilities.
- Cost to taxpayers
The $5 trillion on Fannie's and Freddie's books would not be the cost to taxpayers because the vast majority of the loans would not default. Instead, the cost of the bailout would likely run into the tens of billions - but the range of potential losses is wide.
Few think the government wants to get in the business of running Fannie and Freddie for the long-term. Most think the institutions would need to be restructured so they are no longer both public and private entities: encouraged to take big risks so shareholders can profit while having an implicit government backing if their bets go horribly south. In short, they should not be "too big to fail."
While putting taxpayer money at risk to aid publicly owned companies is never desirable, many say the cost of not aiding the companies - given their central role in the mortgage market - could be worse.
News reports indicate that the boards of directors and top executives at the companies - Daniel Mudd at Fannie and Richard Syron at Freddie Mac - will depart. Both executives have come under heavy fire over the past year as losses have mounted at their companies.
- Shaking up management
A CEO change at Fannie would come just a week after the board stood behind Mudd in a shakeup of the company's finance department, which saw the departure of finance chief Stephen Swad and two other high-ranking officers. Fannie Chairman Stephen Ashley said Aug. 27 that the board "is firmly committed to Dan Mudd."
Syron, who like Mudd has been criticized for his multimillion-dollar paychecks as his company's stock lost 90% of its value, has been looking for a successor since onetime President Eugene McQuade declined the CEO job last May. Syron has suggested at times that he wouldn't be averse to spending more time with his family.
"If I had better foresight, maybe I could have improved things a little bit," he said last month in response to a New York Times report on his handling of risks tied to the housing bust. "But frankly, if I had perfect foresight, I would never have taken this job in the first place."
http://money.cnn.com/2008/09/06/news/economy/fannie_freddie_paulson.fortune/?postversion=2008090615
I think it's ridiculous that taxpayers are being forced to bail out Fannie Mae and Freddie Mac. We shouldn't have to pay for investors' high-risk investment mistakes.
And now the big 3 automakers want a bailout - $50 BILLION in loan guarantees!
Bailouts defeat the whole purpose of having a free market economy. Fannie Mae and Freddie Mac should have to compete in the free market just like every other business, and not demand government handouts to ensure their profitability.
Beige World - Celebrating Multiracial People
http://www.beige-world.com
President Bush, with Treasury Secretary Henry M. Paulson Jr., spoke to reporters in May about the economy. Mr. Paulson, a former Goldman Sachs chairman, became secretary in July 2006.
WHITE HOUSE MEMO
By SHERYL GAY STOLBERG
WASHINGTON — President Bush may be the nation’s first M.B.A. president, but when Mr. Bush and a small coterie of advisers met in the Oval Office last week to complete their plan to rescue the mortgage giants Fannie Mae and Freddie Mac, there was no question who was in charge.
It was Treasury Secretary Henry M. Paulson Jr. who first proposed the idea of a government conservatorship, and broached it with Mr. Bush while the president was at his ranch in Crawford, Tex. It was Mr. Paulson who set the guiding principles for the subsequent deal; Mr. Bush endorsed them, a departure from usual White House practice, in which the president articulates principles for his underlings to follow.
It was Mr. Paulson who, in that Oval Office meeting, plotted the weekend introduction of the plan so as not to rattle financial markets. And it was Mr. Paulson, not the president, who met with Fannie Mae and Freddie Mac executives on Saturday to deliver the unpleasant news that they were now out of jobs.
“He was all the way in the driver’s seat, and that was where the president wanted him,” said Tony Fratto, Mr. Bush’s deputy press secretary, adding, “The sentiment was, ‘You’re in charge, and I hope it works.’ ”
For a president like Mr. Bush, who holds a master’s degree in business administration from Harvard and has strong economic views of his own, Mr. Paulson’s emergence as the administration’s primary voice on economic policy is striking. But time and again in recent months, Mr. Paulson has taken Mr. Bush where he instinctively would not ordinarily go: into the realm of government intervention in the markets.
Since the beginning of the year, that path has brought forth an economic stimulus package, housing legislation, a bailout of the investment bank Bear Stearns and now the Fannie Mae/Freddie Mac rescue.
“Bush was in charge when it was cut taxes, deregulate, have free trade, etc.,” said Representative Barney Frank, the Massachusetts Democrat and chairman of the House Financial Services Committee. “But then the old paradigm broke down, and it fell, frankly, to more serious thinkers to figure out how to cope with the current reality.”
Mr. Bush has never been a fan of the government’s involvement in the mortgage markets; he has long viewed Fannie Mae and Freddie Mac as “ticking time bombs,” said his former chief economics adviser, Al Hubbard. As far back as 2002, he began arguing for greater regulatory control over the companies, but was thwarted by Republicans who controlled Congress. (Democrats eventually granted the authority, which provided the legal underpinning for the takeover announced on Sunday.)
Mr. Bush was so disapproving of Fannie Mae and Freddie Mac, Mr. Hubbard said, that beginning early in his administration he refused to appoint members to their boards. “That is very significant,” Mr. Hubbard said. “No president has ever done that, but he said, ‘We’re not going to put people on the boards of these institutions that are these huge systemic financial risks to the economy.’”
So the idea that the government would become even more involved might seem like anathema to Mr. Bush, and the White House made clear on Monday that the president agreed to the conservatorship only as a last resort. “This is not action that we wanted to take; it was action that Secretary Paulson and others, working with the president, determined that we needed to take,” the White House press secretary, Dana M. Perino, told reporters.
One senior administration official who participated in the meetings, but spoke on condition of anonymity, said Mr. Paulson emphasized during his sessions with the president that the issue was not one of ideology, and Mr. Bush agreed. This person said Mr. Bush spoke little in the meetings, leaving most of the talking to Mr. Paulson.
Mr. Bush is a big believer in delegating authority; on the war in Iraq, for instance, he has said frequently that he makes decisions based on the advice of his commanders on the ground. But throughout his first term and well into his second, Mr. Bush did not have a close bond with a Treasury secretary in the same way that, for instance, he clearly trusts Gen. David H. Petraeus, the top commander in Iraq, or Secretary of State Condoleezza Rice.
His first Treasury secretary, Paul H. O’Neill, who later cooperated with the author and journalist Ron Suskind in a tell-all book, was regarded inside the White House as “a person that you had to keep out of trouble,” said Peter Wehner, a former domestic policy adviser to Mr. Bush. The second Treasury secretary, John W. Snow, was unceremoniously pushed out of his job. Neither man came from Wall Street. Mr. O’Neill ran Alcoa; Mr. Snow was a railroad executive.
Mr. Paulson, a former chairman of Goldman Sachs, joined the White House in July 2006 after an intense courtship by Mr. Bush’s chief of staff, Joshua B. Bolten. He demanded clout and got it, in part because “Paulson did not need the job; the administration needed Paulson,” said Vincent R. Reinhart, a monetary economist at the American Enterprise Institute in Washington.
Mr. Reinhart says Mr. Paulson, like Mr. Bush, would ordinarily resist government intervention. “I think the economy is taking Bush and Paulson to a place where they wouldn’t go on their own,” he said. “In a crisis, you start bending principles, and Paulson bent principles.”
By relying so heavily on Mr. Paulson, Mr. Bush is doing more than bend conservative principles. He is taking himself out of public view in the one area of policy making that matters most to Americans: the economy. Mr. Wehner, Mr. Bush’s former adviser, does not see that as a problem so long as the markets stabilize. And Mr. Frank, the Democratic congressman, said Mr. Bush’s reliance on the Treasury secretary is “one of those things that, historically, will be to his credit.”
Mr. Bush and Mr. Paulson kept in close touch over the weekend, with telephone calls both before and after the secretary’s meetings with the Fannie Mae and Freddie Mac executives. With the decision set, there was little need for lengthy discussion.
“The president called Hank when he got back from Camp David Saturday morning, just to check in on how he thought the meetings were going to go that day, did he feel good about it, was everything still on track,” Mr. Fratto said, describing the first of the two conversations. “It wasn’t a long call.”
<font size="5"><Center>
Acting head of Freddie Mac commits suicide</font size></center>
David Kellermann
WTOP
April 22, 2009 - 8:02am
RESTON, Va. -- The acting head of Freddie Mac, David Kellermann, has apparently committed suicide, Fairfax County Police tell WTOP.
Fairfax County Police spokeswoman Mary Anne Jennings says Kellermann, 41, was found at his Hunter Mill Estates home Wednesday morning.
Jennings says police responded to the home after family members called police around 5 a.m.
"We were called from inside the house to come investigate an apparent suicide," Jennings says.
Because of legal ramifications, Jennings says she can't describe the nature of the suicide.
"We're not to give you details of the condition of the body, except to say it was an apparent suicide," Jennings says.
A final determination that his death was a suicide will come from a medical examiner.
According to Freddie Mac's Web site, Kellermann has been with Freddie Mac for more than 16 years.
He was named acting director of the agency in September 2008.
(Copyright 2009 by WTOP. All Rights Reserved.)
http://www.wtop.com/?nid=600&sid=1657033
I predicted and doing research into the collapse to prevent future ones.
Unfortunately, I have minders that follow me around all day that bumper lock me, I don't want to upset them.