Freddie and Fannie failed to get the message

Freddie and Fannie failed to get the message

Where did all the Trillions come from? And! Where did the Trillions go? Who were the 'winners'?

Real Monies were the Source of the 'paper losses' that are now described as 'write offs'.

The sellers of the 'investments' that were scams did very well! The commission agents did extremely well! And the CEO’s that unloaded corporations of deceit also were winners!

Leaders one and all! Mostly republicans in various forms of control over the everyday lives of Peoples around the World! All were members of the US Chamber of Commerce in one way or another! The US Chamber of Commerce is the grease that greased the scam Worldwide! The defacto agent of the Scam! And a deliberate scam it is! Known full well by the promoters what the end day was, and when it would happen!

Once their Pile was squirrled away, it was happy days and ride the wave! Some losses, make you look like everybody else!

No guarantee of quick housing fix...
:o
Mortgage takeover promises no quick housing fix
Sun Sep 7, 2008 - Washington’s latest attempt to resuscitate the moribund U.S. mortgage business moves the housing market out of the emergency room and into intensive care but by no means cures the patient.

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The U.S. government announced on Sunday it was seizing control of troubled mortgage finance giants Fannie Mae and Freddie Mac, which are vital to the U.S. housing industry and have posed risks to international investors.

The action should lend stability after a year of turmoil in financial markets, and is sure to be watched closely by other victims of deflated housing bubbles, such as the UK. But there is still a long way to go to right the U.S. economy.

“This is a slow process. This is a baby step in the right direction," William Larkin, fixed income portfolio manager at Cabot Money Management in Salem, Massachusetts, said about the plan’s effect on housing and the economy. Larkin added that “it is going to be a positive for our financial system."

Anything that puts U.S. growth on a firmer footing is likely to raise hopes for the struggling global economy, though it could raise risks of already elevated U.S. inflation if investors grow to view this as the government printing money to bail out the economy.

[url=http://www.reuters.com/article/reutersEdge/idUSN0736849820080907:
VITAL SUPPORT[/url]

“The world’s biggest financial bail-out was staged by the American government in a bid to ease the global credit crisis. The country’s two biggest mortgage companies were nationalised amid fears that their bankruptcy would have triggered an economic collapse.”
As To how this first-ever Nationalization of corporations by the United States Government will affect its citizens it is almost beyond describing in any other terms than the largest theft in human history as these unsuspecting peoples, and without having had any say in the matter whatsoever, are now saddled with the added catastrophic debt of over $5.3 Trillion, and which adds to the nearly $10 Trillion they already stand obligated to pay.Even worse for these Americans, is that not only have they been saddled with this horrific financial burden, the losses they will suffer will total in the billions of dollars more as their 401K retirement programmes, and who are substantial holders of these mortgage giants debt, will be lost entirely as with the US Nationalization of Fannie Mae and Freddie Mac they will be totally ‘wiped out’ as the only debts to be paid will be to the foreign central banks.

What it gonna mean to the housing market...
:cool:
What rescue means for mortgage rates
September 7, 2008: Bailout of mortgage giants should result in lower mortgage costs and make credit more available. But lending standards will stay tight and risky borrowers will still pay extra fees.

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Mortgage applicants rejoice! Sunday’s federal takeover of Fannie Mae and Freddie Mac will likely translate into lower mortgage rates and greater availability of credit, experts said. Rates could drop by 1 percentage point from the stubbornly-high 6.39% for a 30-year fixed rate mortgage.

“This could be good for would-be homeowners," said Tom LaMalfa, managing director, Wholesale Access, a research and consulting firm. “It would reduce the cost of financing at the new and improved Fannie and Freddie." The government bailout is aimed at making mortgages easier to obtain and afford. By shoring up the mortgage financing giants, they can continue buying mortgages from lenders and injecting much-needed cash into the system.

“Fannie Mae and Freddie Mac are crucial to turning the corner on housing," said Treasury Henry Paulson. “Therefore, the primary mission of these enterprises now will be to proactively work to increase the availability of mortgage finance. Our economy and our markets will not recover until the bulk of this housing correction is behind us."

But the news isn’t all good. With Friday’s report that foreclosures and delinquencies are at all-time highs, Fannie and Freddie are expected to maintain - if not ratchet up - tighter lending standards. And the fees they have introduced for borrowers with weaker credit histories won’t go away anytime soon.

[url=http://money.cnn.com/2008/09/07/news/economy/fannie_homeowners/index.htm:
High borrowing costs[/url]

See also:

Fannie, Freddie aftershocks: More bank woes
September 7, 2008: Government seizure of Fannie and Freddie could cause problems, even failure, for many small banks, even if it helps to stabilize the battered mortgage market.

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The takeover of Fannie Mae and Freddie Mac is likely to cause big problems for hundreds of community banks nationwide and could lead to a new round of bank failures. That’s because many smaller banks had a large amount of funds tied up in the preferred shares of Fannie and Freddie, depending on the dividends for reliable income, and the value of those shares to meet the capital levels required by regulators. Now the dividends have been scrapped and the share values are in question.

“For many banks it was a safe and steady income stream," said Brian Gardner, senior vice president and chief political analyst for Keefe, Bruyette & Woods, an investment bank that specializes in financial firms. “It’s cutting off an important source of income for the banks at time when income is not easy to come by." The government took over the operations of Fannie and Freddie on Sunday and is keeping both the common and preferred shares in place, leaving it to the market to determine their value. But without the dividends, the already battered value of the shares could fall further, leaving banks that hold them without required capital levels.

Even before Sunday’s action, the FDIC’s watch list of problem banks and thrifts had jumped 30% from the end of March to the end of June, leaving 117 at-risk institutions. A year earlier, the list had just 61. This past Friday, the 11th bank of the year failed. There is still hope that the preferred shares will perform well. “Investors might be relieved that all they did was lose their dividend," said William Isaac, a former chairman of Federal Deposit Insurance Corp. “A lot of people were worried the preferred would be wiped out."

But there’s a lot about Sunday’s action that could further hit shares, which have already lost half their value in recent months. Treasury Secretary Henry Paulson on Sunday indicated that one reason the government had to take control of Fannie and Freddie was “based on what we have learned about these institutions over the past four weeks - including what we learned about their capital requirements." That suggests the upcoming losses are worse than previously believed.

Paulson also said “there is a consensus today that these enterprises pose a systemic risk and they cannot continue in their current form." Gardner said that means at the least there will be a lot of uncertainty about the future of the two firms, which generally is bad for share prices. “We’ve all known about problems for quite some time, but until there was a crisis there was no need to resolve it," said Gardner. “Well, crisis don’t get much bigger than this."

[url=http://money.cnn.com/2008/09/07/news/companies/fannie_freddie_aftershocks/index.htm:
Extent of trouble unknown[/url]

US Government Takes on Big Role in Mortgage Market...
:confused:
Feds' Mortgage Takeover Is $200B Bet
WASHINGTON September 8, 2008 - US government assumes leading role in mortgage market with takeover of Fannie Mae, Freddie Mac

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Uncle Sam has just become the 800 pound gorilla in the U.S. mortgage market. The Bush administration is seizing troubled mortgage giants Fannie Mae and Freddie Mac in a bid to help reverse a prolonged housing and credit crisis. But private analysts worried that it may not be enough to stabilize the slumping housing market given the glut of vacant homes for sale, rising foreclosures, rising unemployment and weak consumer confidence.

Mark Zandi, chief economist at Moody’s Economy.com predicted that 30-year mortgage rates, currently averaging 6.35 percent nationwide, could dip to close to 5.5 percent. That’s because investors will be more willing to buy the debt issued by Fannie and Freddie — and at lower rates — since the federal government is now explicitly standing behind that debt. “Effectively, the federal government has now become the nation’s mortgage lender," he said. “This takes a major financial threat off the table."

Officials announced Sunday that both Fannie Mae and Freddie Mac were being placed in a government conservatorship, a move that could end up costing taxpayers billions of dollars. Treasury Secretary Henry Paulson refused to estimate how much the takeover of the two companies will cost the government, but he insisted that taxpayers will get paid back first. “We structured this facility to protect the taxpayer," Paulson said Monday in an interview on the CBS Early Show. “The government will be repaid ... before the shareholders of these companies get a penny."

In a separate appearance on CNBC, Paulson said “we obviously don’t know” when asked how much the takeover could end up costing taxpayers. He said that will depend on how quickly the housing market turns around. Wall Street posted a huge rally Monday as investors reacted with enthusiasm to the government’s actions. The Dow Jones industrial average was up nearly 280 points in late morning trading.

[url=http://abcnews.go.com/Business/PersonalFinance/wireStory?id=5749648:
MORE[/url]

See also:

Bailout = Lower Rates, Big Taxpayer Bill
Sept. 8, 2008 - Mortgage Bailout Will Be Expensive; Mortgage Will Likely Decline, Taxpayers' Bill to Soar; World markets soar at news of Fannie, Freddie takeover.

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The federal takeover of mortgage giants Fannie Mae and Freddie Mac will likely lower the cost of a mortgage for buyers with good credit, but it will also likely stick U.S. taxpayers with a bill in the tens of billions of dollars, analysts have concluded. The mountain of losses by the two huge quasi-governmental agencies threatened the entire mortgage and credit industry since Fannie and Freddie, as they are popularly known on Wall Street, back up nearly half of the country’s mortgages. Both companies were placed on Sunday into a government conservatorship that will be run by the Federal Housing Finance Agency, the new agency created by Congress this summer to regulate Fannie and Freddie.

Their top executives were fired and replaced by Wall Street veterans. Herb Allison, 65, a former president of Merrill Lynch who most recently led the TIAA-CREF pension fund, will take the corner office at Fannie Mae. David Moffett, 56, a former U.S. Bancorp executive who last year joined the politically powerful Carlyle Group private equity firm, will become CEO of Freddie. The twin takeover, the largest government rescue mission in U.S. history, is packed with global economic repercussions. But for homeowners with a fixed rate mortgage that is being paid for, nothing changes.

For those looking for a mortgage or looking to refinance, mortgage rates may actually go down if the takeover succeeds in stabilizing the market and restoring investor confidence in the market. Mark Zandi, chief economist at Moody’s Economy.com, predicted that 30-year mortgage rates, currently averaging 6.35 percent nationwide, could dip to close to 5.5 percent. That’s because investors will be more willing to buy the debt issued by Fannie and Freddie — and at lower rates — since the federal government is now explicitly standing behind that debt. “Effectively, the federal government has now become the nation’s mortgage lender," Zandi said. “This takes a major financial threat off the table."

More [url:
http://abcnews.go.com/Business/story?id=5750841&page=1[/url]