U.S. Senate Concerned About Mortgage Bailout; Will Hold Hearings

Obviously some of our politicians in Washington are a little worried about all this money that is fixing to be on the doorsteps of these mortgage companies.

U.S. Senate Concerned About Mortgage Bailout; Will Hold Hearings

Senate Banking Committee Chairman Chris Dodd (D-CT) wants Treasury Secretary Henry Paulson to testify before Congress about the government's takeover Fannie Mae and Freddie Mac.
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Paulson had repeatedly urged lawmakers to approve the bill, saying it was only a short-term measure that would likely not be used.

Dodd earlier expressed concern over the administration's announcement on Sunday of the takeover. "There are still many unanswered questions about the Administration's plan, and Americans deserve to know if this unprecedented proposal will help keep mortgages affordable... we need to understand the circumstances which led the Administration to change course. Just weeks ago, Secretary Paulson testified that he thought he would never use this authority- a message he reiterated until very recently," he said in a written statement over the weekend.

This is all fine and dandy, let's make sure this is going to help taxpayers!

But, it was this part that really caught my attention!

It creates a new regulator for the two companies, called the Federal Housing Finance Agency; and modernizes the Federal Housing Administration. It provides $300 billion to help 400,000 homeowners avoid foreclosure through more affordable, fixed-rate mortgages.

It's not like I have a degree in economics or anything, but these numbers seemed wrong to me.

If you divide $300 billion by 400,000 homeowners, it means each homeowner is being given another loan for $750,000?

Online Calculator

If I made a mistake in calculating this, please let me know, I'd like to think I did!

Maybe somebody can explain why it's soo high!

This just sounds a little excessive to me!

I would think if they gave loans for lower priced homes, they could help more people.



[edit on 9/10/2008 by Keyhole]

Yep you got it right, $750,000.00 per each of 400,000 mortages ... but you forgot a couple of things, like giving bonuses to all the top people for doing one heck of a job! So lets give them a few million apiece just because we like them, and then there are the shareholders that have to be made whole, I mean just because they bought a document that states that this investment may lose money is no reason to let them lose money now is it? through a few million more to each of them!

You all realize that the average mortgage in default is under $300,000 and not a single penny of the $300 Billion will go to those people struggling to keep their homes? Every one of them will be required to repay their loans and interest in full, or lose their homes regardless of the bailout. So maybe someone can explain why we're going to be paying the banks three times the original mortgage values on properties the banks will still own and earn money from?

THIS is a fascinating article everyone should read.

Source
The Hidden Bailout Of $1.4 Trillion In Fannie / Freddie Credit-Default Swaps

Something extraordinary happened on Monday, September the 8th, 2008. The government takeover of Fannie Mae and Freddie Mac triggered the pending settlement of $1.4 trillion in credit-default swaps. This single event could have led to a cascading series of failures that might have bankrupted Wall Street and much of the rest of the financial world by the end of the week. That isn't happening, and indeed, the media is treating this as something close to a non-event. However, a very real $1.4 trillion event happened whose resolution effectively constitutes one of the largest government bailouts in history.

reply to post by 2stepsfromtop


You forgot the outrageous salaries of the new Big Cheese of this big government project, the Federal Housing Finance Agency I can not wait to see whom from the "recycle" Freddy and Fanny trash will be taking the position.

After all we can no leave them without their salaries and lavish standards of living.

And you also forgot to add that we the tax payer in this nation will be forwarding the bill.

The rats keep getting fat after all.

According to Catherine Austin Fitts on C2C Monday night, Bush signed
The Housing and Economic Recovery Act of 2008 in July which gave him the authority without Congressional approval to OK the F&F bail out.

IMHO any Congressional hearings on the matter are for show.......

solari.com...

I didn't read the wholebill , Just regurgitating what I heard...........

[edit on 11-9-2008 by Pinktip]

I forgot also that our sitting dictator doesn't need any congress or the people of this nation's opinion to dictate the fate of the ones in need.

Only shows how well regarded the citizens on American are in the eyes of our for the people elected leaders.

[edit on 11-9-2008 by marg6043]

reply to post by Keyhole


750k is the maximum that Freddie/Fannie can secure.. anything over that, they cannot back.

So that the numbers are 400k at the maximum 750k mortgage.. obviously this will be much more in terms of mortgages because not many people are buying 750k+ houses..

SEcond.. I find it hilarious that the House is basically saying "hheeeyyy...... you tricked us! Gosh darn you! Silly paulson.."

Glad we elected those with a 2nd grade education to run the country. Makes me sleep better at night.....

Well, isn't this ironic. They do it, then they have to hold hearings over what they did?

Believe me our legislators were barraged with faxes explaining the whole thing to them in plain English, of what the repercussions would be, and also then barraged with phone calls about it before they voted. Even those that claimed to get it and agree, failed us miserably when it came time to vote.

What a sham!

This is just a dog and pony show and nothing more. We have seen it with the CEO pay, the oil companies, baseball, and on and on. This is for nothing more than to make it look like congress is doing their job. So please sheeple just move on there is nothing to see. Oh BTW for all you taxpayers KY jelly is on sale now at the local grocery store. Stock up because this is going to be a bumpy ride.

How about two Senators asking F&F to freeze foreclosures for 90 days (after elections).....

globaleconomicanalysis.blogspot.com...

www.bloomberg.com...

reply to post by Rockpuck


Thanks Rockpuck, didn't know that.

At least it makes more sense now, glad they aren't just renewing 750k mortgages, but that IS the way they made it sound.

But then again, you never know, maybe they just want to help their "buddies".

I personally am not expecting too much out of any CONgressional hearings. They gave Paulson the authority to do this, bipartisanly. You'll find no bigger chearleaders for banksters thant Barney Frank (D, Mass) Chairman of House banking committee and Chris Dodd (D, Con (?) chairman of the Senate Banking comittee. They are ably aided from across the Isle by Sen. Richard Shelby (R, Alabama) ranking republican and former chairman of the Senate Banking comittee. I don't know who the main Repub on the house committee is, but Ron Paul has been on the committee for a while and though he's talked alot about the problems, I can't name anything he's done to impede or stop these bailouts. He consistently votes no, but I've never seen him do anything beyond that like parlimentary procedural obstruction, slip a poison pill into a bill, or anything other than talk.

I'd love to see barbequed Paulson on the menu for this hearing, but I expect it to be another mutually masturbatory affair, with maybe a little more theatrics. RP will use the oportunity to rail against fractional reserve banking and the Federal Reserve without putting forth and discussing the consequences of changing the system. Frank, with his distinctive (as in sounds like something phallic is in his mouth) voice, might feign concern over the events but will end up stroking and thanking Paulson for doing what he does. A couple of more junior congresspeople from both parties will ask real, tough questions but be limited by time or Frank interrupting when they really get to the meat of the matter. At the end Paulson will continue to do what he does best----be a pigman.

[edit on 12-9-2008 by jefwane]

[edit on 12-9-2008 by jefwane]