Posted on 11/11/2008 7:37:50 AM PST by BGHater
Firms Report Massive Losses, Cite Shortcomings of Rescue
Two months after the government began taking over ailing financial companies, the two largest efforts have failed to go as planned, with the firms complaining that federal officials set overly strict terms and took other unhelpful rescue measures.
Fannie Mae yesterday reported a $29 billion loss for the three months ended Sept. 30 and warned that the mission it was given by the government, to help revive the mortgage market, could be compromised unless the Treasury Department takes new steps to support the company. Fannie Mae chief executive Herbert M. Allison has approached the Treasury about providing more help, but Treasury Secretary Henry M. Paulson Jr. has demurred, according to three sources familiar with the discussions.
The insurance giant American International Group, meanwhile, reported a $24.5 billion quarterly loss yesterday as the government agreed to offer it a more generous lifeline in the form of a new, $152 billion loan on easier terms. The government extended an $85 billion loan to AIG in September followed by $38 billion more in October, but the company has been eating away at it at an accelerating pace.
The struggles of these two largely nationalized companies underscore the government's difficulty in intervening in private markets in a way that both protects taxpayers and ensures that the rescue efforts succeed. The government's experience in addressing the financial troubles at Fannie Mae and AIG offers a cautionary tale at a time when Washington is debating whether to extend the federal umbrella to Detroit automakers and other beleaguered firms. Before September, it had been a generation since the government took over a private company out of concern that its failure could endanger the U.S. economy.
(Excerpt) Read more at washingtonpost.com ...
And Scientist scoff at the idea of humans creating a black hole.
The feds can’t even manage our own house with their cooked book accounting. why should we expect any better results with a socialist intervention?
LOL!
AIG isn’t hurting bad enough! Fox News has video of top AIG execs whooping it up at a Phoenix resort shortly after they recieved their 1st allocation of govment cheese! These clowns need to go to prison ASAP!
shock
nobody saw that coming
GEEZ
giving government money and power...
If nothing at the top is changed, if nothing in the process is changed, any bailout is very literally pouring money down a rathole. They need new leadershup (the present leadership certainly does not have a clue), they need a change in process because obviously what has been done was a total failure. But that will never happen.
How do you lose 25 million bucks when someone just handed you four times that much.
This is going to be the way all over America. The car makers will get billions and turn around and pay union pentions with the money.
Being in the home building industry I hope my bosses are sticking their hands out and saying “We’re here to get our share.”
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