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Fannie, Freddie Bailout Could Cost $363B

From the Wall Street Journal:

Fannie, Freddie Elicit Grim Forecast

By NICK TIMIRAOS
OCTOBER 22, 2010

Propping up Fannie Mae and Freddie Mac will cost taxpayers $154 billion under the most likely scenario for home prices, the mortgage giants’ regulator said Thursday. But the bill could end up much greater—nearly double the $135 billion already spent—if grimmer projections prove true and the economy slides back into recession.

Fannie Mae and Freddie Mac’s regulator said Thursday that the companies could end up costing the government $363 billion.

The projections, based on the results of a home-price "stress test" by the Federal Housing Finance Agency, offered the first public estimates of the final cost of the government’s rescue of the mortgage-finance firms, which is on track to become the most expensive legacy of the 2008 financial crisis

And, even though Fannie Mae and Freddie Mac are the personal creations of Congress, and they are supposedly ‘overseen’ by Congress — somehow Congress is never blamed for what they have done.

The results could shape the debate over the long-term role that the government should play in the mortgage market.

How can there be any debate? What more will it take to convince people that government bureaucracies should not be involved in the mortgage business? Do they need a house to fall on them?

The Obama administration, which has promised to outline its proposed overhaul of the broader housing-finance system by next January, has said a government role may still be needed to preserve the long-term, fixed-rate mortgages that have become the keystone of the American mortgage market

Have no fear. Mr. Obama is not in the business of getting government out of the way. On the contrary, he will do everything in his power to increase government involvement in the mortgage industry.

Indeed, lest we forget, Congress just passed and Mr. Obama just signed wildly heralded ‘financial reform’ legislation. Which in its 2,319 pages did absolutely nothing to address the problems at Fannie Mae or Freddie Mac.

Instead, as we noted last week, these selfsame Solons at Fannie and Freddie have been paid $240 million taxpayer dollars to oversee the TARP bailout.

Somehow the government always finds a way to reward incompetence.

This article was posted by Steve on Friday, October 22nd, 2010. Comments are currently closed.

7 Responses to “Fannie, Freddie Bailout Could Cost $363B”

  1. GetBackJack says:

    Fannie Mao and Fidel Mac

  2. finebammer59 says:

    somewhere franklin raines…….

    (in his 5 million dollar manhattan flat bought with his 90 million dollar golden parachute)

    smiles.

  3. eaglewingz08 says:

    And in New York State we have the architect of the ‘greatest crisis since the Great Depression”, Andy Cuomo sailing to victory in the Guv race cause a democrap plant, Carl Paladino and the NYS GOP, have pissed away the best chance for a repub sweep in the guv and senate races in a generation.

    • Adam Moreira says:

      Paladino is the candidate endorsed by the Tea Party Express movement – he self-destructed his own campaign though. But to call him a Democratic plant is crazy, given that here in NY, the primary system is closed. It’s simply that downstate turnout was low to ensure a Paladino win in the primary.

      (Downstate – generally the New York metropolitan area.)

  4. finebammer59 says:

    you’re not alone, ew.

    here in alabama we’re stuck with a rino backbencher in the governor’s race planted there by paul hubbert and the alabama education association. (the teacher’s union)

    we have our first legitimate chance in 136 years to break the death grip of democrat control in the legislature and we’re stuck with this tomato can leading the ticket.

    sheesh!

    • Adam Moreira says:

      That may be because the legislature is controlled by Democrats. Incidentally, your state owns prime real estate in NYC (55 Water Street) and your state’s business is tangentially my city’s business.

    • finebammer59 says:

      not to bog the blog (bog the blog???) down with flyover state politics but………

      state democrats have never been more vulnerable.

      one democrat politico had a bag of ganga placed in his office closet by a state house janitor with a mile long rap sheet.

      another was caught driving drunk after hitting a bystander and being chased by state troopers from montgomery to birmingham.

      but those were just the previews before the main attraction. the feds have now arrested eleven, four state senators, four lobbyists, two gambling magnates and one state house employee in a pay for votes scam.

      all the senators are democrats or recently democrats.

      but what is the buzz on local talk radio???

      the tomato can who told us he didn’t accept help or money from the democrat strongarm teachers union in the republican runoff election and has been caught redhanded in the lie.

      every time i see this clown on tv i want to go shower.


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