The Fannie Mae Gang

WSJO ^ | July 23, 2008 | PAUL A. GIGOT

[jessduntno]

The Fannie Mae Gang By PAUL A. GIGOT July 23, 2008; Page A17

Angelo Mozilo was in one of his Napoleonic moods. It was October 2003, and the CEO of Countrywide Financial was berating me for The Wall Street Journal's editorials raising doubts about the accounting of Fannie Mae. I had just been introduced to him by Franklin Raines, then the CEO of Fannie, whom I had run into by chance at a reception hosted by the Business Council, the CEO group that had invited me to moderate a couple of panels.

Mr. Mozilo loudly declared that I didn't know what I was talking about, that I didn't understand accounting or the mortgage markets, and that I was in the pocket of Fannie's competitors, among other insults. Mr. Raines, always smoother than Mr. Mozilo, politely intervened to avoid an extended argument, and Countrywide's bantam rooster strutted off.

AP Clockwise from top left: Barney Frank, Franklin Raines, Mike Oxley, Angelo Mozilo and Paul Krugman. I've thought about that episode more than once recently amid the meltdown and government rescue of Fannie and its sibling, Freddie Mac. Trying to defend the mortgage giants, Paul Krugman of the New York Times recently wrote, "What you need to know here is that the right -- the WSJ editorial page, Heritage, etc. -- hates, hates, hates Fannie and Freddie. Why? Because they don't want quasi-public entities competing with Angelo Mozilo."

That's a howler even by Mr. Krugman's standards. Fannie Mae and Mr. Mozilo weren't competitors; they were partners. Which explains why Mr. Johnson could feel so comfortable asking Sen. Kent Conrad (D., N.D.) to discuss a sweetheart mortgage with Mr. Mozilo, and also explains the Mozilo-Raines tag team in 2003.

[jessduntno]

"Angelo Mozilo was in one of his Napoleonic moods. It was October 2003, and the CEO of Countrywide Financial was berating me for The Wall Street Journal's editorials raising doubts about the accounting of Fannie Mae. I had just been introduced to him by Franklin Raines, then the CEO of Fannie, whom I had run into by chance at a reception hosted by the Business Council, the CEO group that had invited me to moderate a couple of panels."

Good grief.

[FormerACLUmember]

The entire criminal gang of mega-greedy democrat party thieves at Fannie Mae belong in jail with all their stolen vast assets seized.

Starting with that truly evil b*tch, Jamie Garelick.

[jessduntno]

“Starting with that truly evil b*tch, Jamie Garelick.”

The Stovepipe Queen?
Where would you start with her??
She will be repaid when she meets her maker.
Sooner, I hope, rather than later.

[JohnLongIsland]

To quote everybody’s favorite reverend:

“The chickens are coming home to roost.”

[Ann Archy]

I want INDICTMENTS....PRISON....for Raines, Gorelick, Jim Johnson, et al.

[Jaded]

The sad thing is people still don’t get it. And they forget that Johnson was one of the ones vetting the vp for the O.

Oh, I forgot, it wasn’t on ABCCBSNBC.

[johnny7]

[Terry Mross]

Is Angelo a member of the Soprano family?

[OrioleFan]

The all need to go to the Big House.

[Plutarch]

AP

Clockwise from top left: Barney Frank, Franklin Raines, Mike Oxley, Angelo Mozilo and Paul Krugman.

[Terry Mross]

...and Dodd and Frank and....____________fill in the blank.

What I don’t understand is why in the world does a government backed company have lobbyists lobbying the very politicians who fund them and make laws that affect them. Seems I remember McCain getting into hot water over the same thing...something about a Keating S&L? Mmmm?

[bereanway]

The companies also mobilized their Wall Street allies, who benefited both from promoting their shares and from selling their mortgage-backed securities, or MBSs. The latter is a beautiful racket, thanks to the previously implicit and now explicit government guarantee that the companies are too big to fail. The Street can hawk Fan and Fred MBSs as nearly as safe as Treasurys but with a higher yield. They make a bundle in fees.”

Good money made here by our buds on Wall St whom King Henry now wants to unconditionally bail out due to the systemic risk generated by their greed and incompetence. The securitization of debt and the ancillary credit derivatives generated by Wall St. made for a good party while it lasted. A very strange relationship between the left, fannie and freddie, wall st., the fed and the treasury.