[Pastnowfuturealpha]

In the post: "Fannie, as federally chartered institutions, have the implied faith and credit of the U.S. Treasury behind their debts."

And in the post: "Should Freddie or especially Fannie collapse, the cost to the U.S. economy would be massive - "

Not being any where near an expert - I need to ask a stupid question: Are you saying this organization has the power to bring down the U.S. Treasury - ? Or abuse it to the point where it would damage the country? If so - another question would be: Who would be responsible for seeing that the government wouldn't get in this kind of trouble, so to speak - ? Who let it get to the point where it is - ?

Just wondering -

[AdamSelene235]

It would take out most money center banks (derivative counterparties), many small banks (who use GSE paper as cash equivalent reserves), your 401K money market(using Fannie repos) and "high quality" bond funds, the dollar, and easily halve the value of American homes.

Game over, do not pass go, do not collect $200.

Who would be responsible for seeing that the government wouldn't get in this kind of trouble, so to speak - ? Who let it get to the point where it is - ?

Americans who look to the government to solve all of their personal problems.

[AdamSelene235]

" I believe that banking institutions are more dangerous to our liberties than standing armies . . . If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] . . . will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered . " -- Thomas Jefferson -- The Debate Over The Re Charter Of The Bank Bill, (1809)