Posted on 07/13/2008 7:29:42 PM PDT by quesney
NEW YORK: In a country that holds itself up as a citadel of free enterprise, Washington has morphed from being the lender of last resort into effectively the only resort for home loans for millions of Americans engaged in the largest transactions of their lives.
Before, the government's more modest mission was to make more loans available at lower rates. Now it is to make sure the loans that matter most to middle class Americans are made at all.
The new reality is scorned by libertarians and conservatives, who fear intrusions by the state in the market, and by populists and progressives, who rue a society in which education and housing increasingly rest upon the government's willingness to finance it.
"If you're a socialist, you should be happy," said Michael Lind, a fellow at the New America Foundation, a research institute in Washington. "But you should really wonder whether you want people's ability to pay for housing and college dependent on the motives of people in Washington."
Why is this happening? Much of the private money that once surged into the mortgage industry has fled in a panicked horde, leaving most of the responsibility for financing American homes to the government-sponsored Fannie and Freddie.
(Excerpt) Read more at iht.com ...
It is a very sad day. Be afraid. Be very afraid.
The really scary thing is that Obama isn’t even president yet.
Not a good precedent.
Remember that Wall Street Journal headline after the Bear Stearns bailout? “Ten Days That Changed Capitalism.”
The real scarry thing is no one takes on these issues except by replies here. Are you all ready for a active revolution? Ans: no.
The hypocrisy of the U.S. in this case is overwhelming. Money quotes from IHT article:
For a generation, U.S. policy makers have lectured the world on the need to unleash the animal instincts of the market. China’s rickety banks should stop lending to protect state factory jobs, Americans said, and focus on the bottom line. Now the Bush administration is reluctantly concluding that Fannie and Freddie might need to be propped up to protect the U.S. homeowner.
During much of Japan’s lost decade of the 1990s, Americans called for an end to the nation’s coddling of weak banks. Better to let them keel over, along with the paper tiger companies they sustained. No company was “too big to fail,” Washington said.
Fascism/socialism. Taxpayers get raped “for our own good”. Again. More inflation, more debt, more taxes, more spending.
But what’s the alternative? There really isn’t one, unless we want to return to a system where only the wealthy can buy houses (with cash) for the next 20 years while things shake out.
However, the only reason the government has to be involved now is because they got involved in the first place.
We’re either gonna get raped by taxes and inflation, or by mass unemployment and a depression.
anything that is done keep fannie and freddie solvent will likely be temporary and is not “socialistic” at all, necessarily; and for the IHT, the global version of the NYT, to say it is ought to make people wonder what their trying to distract from.
The corruption of wall street during the Bush years has unfortunately reached monumental proportions. The pendelum is now swinging all the way to the other side.If the SEc was not so dirty and corrupt-we could have avoided all this imo
Now, here's were this story is most troubling...Fanny and Freddie ARE government institutions. Are we witnessing an incredible, historic, unprecedented concentration of control and wealth that is being under or mis-reported by the media????? That's my bet.
I'm curious as to just how this is going to negatively affect you?
Had government never meddled in the first place, we'd be ok. I can't believe anything they do to clean up their own mess will be helpful in the end.
What I wonder is what happens as these collatoralizations of home loans fail. It tentatively looks like a house mortgage is owned by bank A but sold as a secured debt to bank B who chopped it up and mixed it up and those pieces are owned by C, D, E and pensions funds.
When the money is needed by these banks, who exactly gets to repossess the house? And when the house is repo’d, who specifically gets paid?
Best personal solution I can think of is sell anything and everything to pay off your house.
Don’t know much about Alexander Hamilton do ya?
The SEC can’t even do its job because the Dems won’t even have confirmation hearings for candidates Bush has put forward.
How about some links to back up your “corruption” claims.
Not quite - FNM was chartered by congress in 1938, but in 1968 was privatized. Now its being publicized again, sorta.
Check & Mate!
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.