Report: Government may soon back Fannie Mae, Freddie Mac

Didnt watch the movie links above yet but guess what the new headline is at MSN? Looks lke the OP was right on time.

www.msnbc.msn.com...


U.S. nears rescue plan for Fannie and Freddie
Deal said to involve change of leadership, infusions of capital


whoops somebody already posted the link. sorry

[edit on 6-9-2008 by lunchmanstan]

reply to post by lunchmanstan


What is so deceptive in the article link you posted from MSNBC is the constant use the term "government" as being the decision makers here. These true decision makers/designers are the Federal Reserve itself of which is made up of a PRIVATE consortium of international bankers looking out for 'their' interests...not the citizen's. They don't even mention the Federal Reserve in the article though that is SOP for the banking cartel...deception and disinformation to fool the public into acceptance of that which they don't understand. The mere fact that the true players involved are not being disclosed to the public is a violation to public disclosure. While the public is being led to believe they are being bailed out...what is really happening is that the Federal Reserve is performing an financially engineered and planned takeover of HALF of the US mortgage industry in one giant move. Have you noticed how quickly they are attempting to close this 'transaction' without confirmation or even disclosure to the Senate and House. Congress, by order of the Constitution is the only power authorized to accept this takeover. Apparently their participation is not necessary here just like it wasn't necessary when the Fed. Reserve was created in a secret meeting on Jekyll Island decades ago in absolute secrecy as the link explains below.

video.google.com...

reply to post by yellowcard



yellowcard, what is so brilliant about a system that keeps you enslaved to debit with interest rates? How is this such a good plan? Please enlighten us.

Disgusting....just disgusting. Ive seen more bailouts in the past year to make me vomit 20 times over. The sad thing is it doesnt end here. Wait till the airlines and the automobile industries gets their bailouts also. So much for a free market. Hey Im glad as a taxpayer I get to bail these guys out but meanwhile Ive had to lay off more than half of my employees and am only hanging in by a thread. Wheres my bailout? The hypocrisy is so obvious. Its ironic because its these same companies that park all their cash over seas so they dont have to pay taxes on any of the money.

Now in regards to my boy yellowcard and we have had this discussion many o times before the fed does need to be abolished. The fiat currency destroyed and we need to give the power of our currency back to the people and not to the bankers. The point of the fed was for financial stability and to keep inflation at a minimal which as we all know is not the case for the dollar is only worth .07 of what it was when the FED took over. Im game to the scam and when you have a scheme where you can rob people by inflation and then go and print the money to pay crack money for the assets people lose because of this is disgusting. On top of this you can never pay back the debt. Never. Our dollar is debt so no debt = no dollar do you think the banks want that? Its a good idea I agree but it favors by far a select few unless you really know how to work the system

reply to post by disgustedbyhumanity

How about a little help for those losing their homes?

If the banks would renegotiate the interest rates to something a bit lower instead of hiking them up to as high as 30% there would not be a problem. The banks made the problem, and the little guy pays for it twice. Once when he loses his home and the second time when his taxes are given to the bank that took that home. GRRRrrr

reply to post by mybigunit


Wanna know something disgusting?

The top five foreign holders of Freddie and Fannie long-term debt are China, Japan, the Cayman Islands, Luxembourg, and Belgium.

&dist=hppr]sour ce

$376 Billion in Chinese Agency Bond Holdings Subject to Taxpayer Bailout Proposals According to FreedomWorks Analysts

This is who is getting bailed out. Yea there a a bunch of domestic stuff involved that are worth way more than what the foreigners are holding but if Fannie and Freddie collapsed on their own, the entire Chinese economy would follow.

We the tax-payers are bailing out FOREIGNERS. China bought into debts backed by Fannie Mae and Freddie Mac to lower their own currencies compared to the dollar and make some money form the housing bubble. They thought they had a huge free ride because the debt was insured, they were right, and my wallet is part of that insurance.

So not only did China use Fannie Mae to lower their currency, take U.S. jobs, and create a trade imbalance....they get bailed out when their scheme crumbles and their economy is put in danger.

It sure is nice to invest somewhere and know that if the risk you take happens to fail, the American tax payer will back you up.


[edit on 7-9-2008 by wutone]

And now it looks like both candidates are supporting a bailout

www.bloomberg.com... r=home

The divine Obama says

``It looks like the Bush administration is going to intervene with a bailout that could end up costing taxpayers billions of dollars,'' Obama, the Democratic nominee, said today while campaigning in Terre Haute, Indiana. ``These entities are so big and they are so tied into the housing market that it's probably true that we have to take steps to make sure that they don't just collapse.''

Mr John "the experienced" McCain says

``We've got to keep people in their homes. There's got to be restructuring, there's got to be reorganization, and there's got to be some confidence that we've stopped this downward spiral,''

They as worried about keeping people in their homes, they want to keep home prices high and protect their interest groups. This downward spiral is a correction on all that greed that churned the system.

Fannie and Freddie are just vehicles to insure the moral hazard of those that bought into the debt.

What they don't want to say is that they are worried about a Chinese economic crash.

I'm just posting what another op put up in breaking news.

US takes over key mortgage firms

US financial officials have outlined plans for the government to take over the failing mortgage giants Freddie Mac and Fannie Mae.

The two companies account for nearly half of the outstanding mortgages in the US, and have lost billions of dollars during the US housing crash.

The most recent figures show about 9% of US homeowners were behind on their payments or faced repossession.

The federal takeover is one of the largest bail-outs in US history.

'Comprehensive action'

As part of the changes, the management of the two companies will be replaced and the firms will be given access to extra funding to support their business going forward.

Treasury Secretary Henry Paulson said the government was intervening in the wider interests of the financial system and of taxpayers since the financial position of the two firms was fast deteriorating.

He added that the two firms' debt levels posed a "systemic risk" to financial stability.

"We examined all options available and determined this comprehensive and complementary set of actions best met the objectives of market stability, mortgage availability and taxpayer protection," he said.

The move is intended to keep the two companies afloat, amid fears that either could go bankrupt as borrowers default on their home loans.

Together, Freddie Mac and Fannie Mae own or guarantee about $5.3 trillion (£3 trillion) of mortgages.

Banks around the world are highly exposed to the two companies and therefore, given the febrile state of markets across the world, it had become dangerous for doubts to persist about whether they were viable and would be able to keep up the payments on their massive liabilities, says the BBC's business editor Robert Peston.

A rescue plan passed by Congress in July gave the US government the authority to offer unlimited liquidity to the two companies, and to buy their shares, in order to keep them afloat.

source

I am not totally convinced the other thread should have been shut down as this thread is titled "Government MAY soon take back ..." whereas the other thread reporting on the BBC News story is titled "US takes over key mortgage firms" which is more accurate.

The aren't talking about the possibility of a bail out anymore, the are in fact taking them over!

[edit on 2008-9-7 by primamateria]

Speaking from an Australian point of view, it has affected council bughets and even charities over here who invested in these companies when all the ratings were AAA. The US and the World has been ripped off totally! And while I am sure US tax payers will cop the lions share, I am also worried that the US might look to more oil stealing, warfare or drug dealing to pay back this debt. My 2 cents anyway.

Another interesting commentry from the BBC..

Fannie, Freddie, Cheshire and Derbyshire

Robert Peston 7 Sep 08, 02:54 PM


After a brief period of calm in the summer, new disturbing evidence has been disclosed today of the weakened condition of financial institutions, both big ones and smaller ones.

The US Government is in effect nationalising North America's two biggest providers of finance for the housing market, Fannie Mae and Freddie Mac.

Their regulator, the Federal Housing Finance Agency, is taking direct control of them under a system known as "conservatorship".

This is an event of profound significance for the global economy, since these two eccentric institutions own or guarantee almost £3000bn of US mortgages.

Banks, including some of the world's most important central banks, have direct and substantial financial exposure to both Fannie and Freddie.

So, given the febrile state of markets across the world, it has become dangerous for doubts to persist about whether these two are viable and would be able to keep up the payments on their massive liabilities.

What's brought Fannie and Freddie to this humiliating impasse?

Well there's the continued decline in the US housing market, the sorriest housing market on the globe (for all the falls in UK house prices).

And then there's the discovery by Morgan Stanley, the investment bank advising the US government, that Freddie's capital resources are smaller than meets the eye.

For the US Treasury, the bailout could turn out to be one of the most expensive financial rescues in history, running to tens of billions of dollars.

Bad news, except perhaps for our own Chancellor of the Exchequer, Alistair Darling - since the Fannie and Freddie rescue costs may well make the potential losses for the taxpayer from Northern Rock seem almost modest (well almost).

Also the US banking debacle gives a bit more credibility to Darling's claims that the UK's economic and financial woes are at least in part the consequence of a global storm, for which he shouldn't be blamed too much.

In fact, while I write, two of our own housing-finance institutions are being steered by the Financial Services Authority into safe harbour, as the Nationwide negotiates to take ownership of two rival building societies, the Cheshire and the Derbyshire.

These are tiny compared with Fannie and Freddie, but they are not trivial in a UK context.

Derbyshire is the UK's ninth largest building society with £7bn of assets and the Cheshire is number 11 with £5bn. Together they have not far off a million customers.

But each has a structural flaw which makes it harder for them to carry on as an independent.

Derbyshire is perhaps a bit too dependent on funding from wholesale financial markets, which since the onset of the credit crunch last summer has been much harder to obtain.

And Cheshire has a commercial property business that is not in the greatest shape.

So although neither of them are bust and there is no reason for their depositors to be unduly alarmed (their savings are safe), the City watchdog, the FSA, wants them under the stewardship of the more robust Nationwide.

The harsh reality of the decline in the housing market means that the members of the Derbyshire and the Cheshire should not expect a windfall or any kind of payment from this deal.

Nor will they get a vote on whether the mergers will go through, as normally happens in consensual deals.

I have learned that the FSA will use its power to force through the transfer of ownership fairly speedily - because any period of uncertainty about the ownership of a bank or building society right now is fraught with risks.

source

Humm, a financial market failure that allows the "government" to buy our corperate firms for a pittance, where've I seen this before???

Well we all know the "government" will be selling these shares to certain other companies when the market comes back on track, how convenient .

Originally posted by spitefulgod
Humm, a financial market failure that allows the "government" to buy our corperate firms for a pittance, where've I seen this before???

Well we all know the "government" will be selling these shares to certain other companies when the market comes back on track, how convenient .

Yeah where have we seen this before hmmmm. This ticks me and I mean REALLY ticks me off to no avail. Im curious to see these pundits on CNBC and places like that and their reactions. A lot of these guys during the boom was like forget taxes we need to keep all the money ourselves and the government shouldnt help out the homeowners or do this or that for the people that is socialism. Then this the mother of all schemes. Im for no taxes to but Im also for letting businesses fail when they mess up. If the government knew they were going to bail these guys and others out then then need to tax the pi$$ out of them. Its not fair people like me who has a business and have had to lay off half my employees to stay in business should have to pay my tax dollars to bail them out. They need to let them fail and let houses fall to very little. People WILL buy at the right price plain and simple as that.

reply to post by mybigunit


I tell you what why all the people that are facing foreclosures and those that are already homeless line up the streets of Washington and the mall area setting camp to demand the government to bail them out also.

They're not just bailing them out... they're buying them.

The government itself is set to own the company. This is an action too in line with socialism for my liking.

(Aside) Yeah, the other tread I started was closed. You have a point, it was more in line with what they ARE doing, rather than with what they are thinking about doing... but hey, no skin off my back. It's not like I lose points or anything.


Anyone else being irked the wrong way by this move?

They're not bailing them out, they're buying them out.

not sure why new thread was closed either..big difference between 'bailing out' and what has happend

the goverment has taken over, and replaced both executive and executive boards!!

Officials announce takeover of mortgage giants

Officials announced that the executives and board of directors of both institutions had been replaced. Herb Allison, a former vice chairman of Merrill Lynch, was selected to head Fannie Mae, and David Moffett, a former vice chairman of US Bancorp, was picked to head Freddie Mac.

wow..just, wow...

edit(had to save my lunch from burnning)

again, I'm really disappointed that the mod closed the other thread..I mean, if I was just browsing looking at the headings I would skip this one by..as I did actually since this has been up since the 5th..I noticed the NEW breaking news on my YAHOO news page...seriously..jumping the gun a little on closing threads?? at least change the title on the OP's so the change shows up

[edit on 9/7/2008 by toepick]

The Government really can't do what they are doing but I can understand why. These are two of the largest financial institutions in the USA and the world. The back millions of loans and investments. If they fail then it is a domino effect as far as the global economy goes. Now with that said, It would be worse than the great depression and the period after the civil war combined for the economy and inflation. Plus if the US government doesn't do anything, there is another government around the world with nearly a trillion of US dollars burning a whole in their pocket. I don't think that we want that much control and sovereignty of our economy to the Chinese. It is just the lesser of two evils, the evil master here or the evil master around the globe.

Well, it happened before people. Remember the govenment take over of PennCentral, and was then named Conrail by the government. That was just a way for the government to learn how to take over a big corperation and make money on it in the end(When N&S bought it from the govenement). It was the same situation. Both failed, PennCentral, Fannie and Freddie. It`s going to be the same thing all over. Conrail was sold because it got to a point where it was costing the governemnt way to much to operate it, and it`s going to be the same with these banks.

Both my mother and father grew up during the depression. They always said to my brothers and I, "You have it way to easy.". Yes, they said it was rough going at times, but, they survived it. They said today it` s way to easy for people to be handed things, and not have to work for it in the end. They said it brought families together and people shared what they had. Do you believe people could do that today if a depression were to happen? It makes me wonder at times.

Originally posted by yellowcard
Blah Blah Blah, the Federal Reserve System is a brilliant system..y

sure it is, the real question is why should all money be issued by the banks as loans, for which they can then collect interest?

what have they done to justify perpetual interest payments, which, to top it off, are increasing over time by design. take out $100 be obliged to pay $102 and after a while the entire world belongs to them, ie. right now.

brilliant? i don't think so, the media blitz and intrigues that allowed the system to be established were brilliant, the fed itself is just a scam backed by armed forces.