Free Republic

From the "credit where it's due," or perhaps more appropriately, "better late than never" department, check out this account of a recent Fox Business interview with Frank: "[Fannie Mae and Freddie Mac] should be abolished," Frank said in an interview on Fox Business, when asked whether the mortgage giants should be elements in housing market reform. "They only question is what do you put in their place," Frank said. ... Frank also was critical of public policy that promoted homeownership at any cost. He also said the federal government should not be a "backstop" in guaranteeing mortgages. "There were people...

As the Democrats attempt to blame former President George W. Bush for all the ills of the current economy, it is worthwhile to remember that the collapse of the housing market due to Fannie Mae and Freddie Mac loans that should have never been approved was the driving force behind the economic collapse of 2008. President Bush, along with other Republicans like John McCain had tried to move legislation to deal with the loans being given to people who simply could not afford to buy a house. But Democrats led by Barney Frank insisted on their social engineering policy that...

This was the rumor last week. It sounds laughable. I don’t want to believe it. The Treasury Department denied it. But when it comes to the Magic Kingdom that is the Obama administration, the fantastical has a way of coming true. “From Washington to Wall Street,” Reuters columnist James Pethokoukis wrote on Thursday, “there are rumors that the Obama administration is about to order government-controlled lenders Fannie Mae and Freddie Mac to forgive a portion of the mortgage debt of millions of Americans who owe more than what their homes are worth.” That’s right. If you bet badly in the...

The rumors are continuing to grow louder that the Obama administration is planning to announce a massive stimulus via the housing market later this month. Earlier this week, the word was that the government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac might subsidize mortgage refinancing at below-market interest rates. But today, a possibility is being talked about where the GSEs instead (or maybe also) forgive the principal on the underwater mortgages they own or guarantee. James Pethokoukis of Reuters suggests that this could amount to as much as $800 billion. This would be such a huge move that it's hard...

Main Street may be about to get its own gigantic bailout. Rumors are running wild from Washington to Wall Street that the Obama administration is about to order government-controlled lenders Fannie Mae and Freddie Mac to forgive a portion of the mortgage debt of millions of Americans who owe more than what their homes are worth. An estimated 15 million U.S. mortgages – one in five – are underwater with negative equity of some $800 billion. Recall that on Christmas Eve 2009, the Treasury Department waived a $400 billion limit on financial assistance to Fannie and Freddie, pledging unlimited help....

Post-receivership, the GSEs have become a government sanctioned back door bailout of regular banks. Any mortgage that cannot be refi’d or modified ends up on their books. This includes mortgages on the verge of default and foreclosure. How much is the worst case scenario for the ongoing bailout of the banking sector, plus Fannie’s and Freddie’s own screw ups? If everything goes precisely wrong, taxpayers are potentially on the hook for another $1 trillion bailout: The cost of fixing Fannie Mae and Freddie Mac, the mortgage companies that last year bought or guaranteed three-quarters of all U.S. home loans, will...

In a statement to the Congressional Hearing, Alan Greenspan, the former chairman of the Federal Reserve, defended his policy on interest rates and placed the blame for the recent crash on the fact that most new mortgages in the final years of the property boom were securitized. According to Mr. Greenspan: “By the first quarter of 2007, virtually all sub-prime originations were being securitized, and sub-prime mortgage securities outstanding totalled more than $900bn.” An economist of equal weighting and stature, Mark Zandi, chief economist of Moody's Analytics, countered Mr. Greenspan’s comments by suggesting to the hearing that “aggressive monetary policy...

You better be, when the implications of this one ripple through: McLean, VA – Freddie Mac (NYSE: FRE) announced today that it will purchase substantially all 120 days or more delinquent mortgage loans from the company's related fixed-rate and adjustable-rate (ARM) mortgage Participation Certificate (PC) securities. What this means is that all the defaulted loans in these packages that Freddie bought up, bundled up and then puked out into the marketplace are coming home. To Freddie. Well, at least initially. But now, every one of these loan files is going to get the fine-tooth-comb treatment. And believe me, there's gonna...

"There is not a Black America and a White America and Latino America and Asian America," declared Barack Obama at the 2004 Democratic National Convention. "There's the United States of America.'' One year has passed since Barack Obama and a Democratic Congress were swept into power. We felt our racial sins had been washed away as millions of whites pulled the lever for Barack Obama. He promised us unity and clearly implied that he would govern in a color-blind way. This promise, like so many others, has been broken. The administration and Congress have passed policies clearly based on favoritism....

Marla Singer at Zero Hedge writes: It has become conventional wisdom, perhaps even cliche, to pin the origins of the credit crisis on the big banks or, AIG or even the practice of financial modeling. Certainly, these actors have received the most play in the media, and have now endured the focus of populist ire for more than a year. We now think that the analysis leading commentators to focus blame on these entities is fatally flawed. We have seen no credible data that any of the large banks or other underwriters of mortgage backed securities ("MBSs") or collaterized debt...

The Obama administration's decision to cover an unlimited amount of losses at the mortgage-finance giants Fannie Mae and Freddie Mac over the next three years stirred controversy over the holiday. The Treasury announced Thursday it was removing the caps that limited the amount of available capital to the companies to $200 billion each. Unlimited access to bailout funds through 2012 was "necessary for preserving the continued strength and stability of the mortgage market," the Treasury said. Fannie and Freddie purchase or guarantee most U.S. home mortgages and have run up huge losses stemming from the worst wave of defaults since...

Of all the things you could say about Fannie Mae (FNM) and Freddie Mac (FRE), too-strict lending standards probably wouldn't come to mind. Afterall, the companies have been backstopped to the tune of $400 billion, which has to mean their standards were too loose. But powerful Congressman Barney Frank, in a desperate attempt to reflate the old bubble, says the two GSEs are being too stingy, particularly with respect to condos. WSJ: Fannie and Freddie have restricted loans to condo buyers in these situations because they represent a red flag that the developments -- many of which were planned and...

Steve Sailer dusts of this Realty Times article reminding us that President Bush's program to increase minority home ownership relied heavily upon the generosity of Fannie and Freddie. Sailer asks, "By the way, do you ever get the feeling that historians will someday look back on the Bush-Obama years as a single era?"

A Barney Frank for Congress 2008 ad...Enjoy! http://www.youtube.com/watch?v=nF0U-si6ZSg

Was the current economic situation caused by too little government intervention in the financial markets—or too much? I'd say the latter. Washington used Fannie/Freddie as a political piggy bank, causing it dole out loans to people who had no business receiving them. And because Freddie and Fannie's obligations enjoyed the implicit guarantee of the federal government, they were able to obtain funds at lower rates and become by far the biggest dog on Mortgage Street. That in turn caused private-sector banks to lower their lending standards in order to be able to compete. Throw in the Community Reinvestment Act, another...

During the, "Turmoil in the Financial Markets, Panel 1, hearings on AIG," Rep Chris Shays followed up his comments yesterday about Democrats refusal to investigate Fannie and Freddie, calling them the, "Toxic Twins," which should be the center of the investigation, not an afterthought. "We can't wait until Halloween to investigate these two failed monsters," he said. He also goes into detail on the accounting fraud and money Raines made while CEO. Link is C-SPAN video of Shays' remarks.

Yesterday during a meeting of the House Committee Oversight and Government Reform, Review of Lehman Brothers Finances, Panel 1, Congressman Christopher Shays blasted Congress for their role in the Financial meltdown and blasted Waxman and the Democrats for not investigating Fannie Mae and Freddie Mac and the role they played in starting the Crisis. He then lists all the Republican attempts to reform FM/FM that were blocked by Democrats. Skip ahead to 2:09 (near the end) to hear his remarks

Explosive Audio Unearthed: After the Sub Prime Crisis already started in 2007 Obama says Sub Prime Mortgages that gave houses to people WHO COULDN'T AFFORD THEM was a GOOD IDEA!! Even as it was destroying our economy Obama thinks giving people mortgages who couldn't afford them was a good idea. Then he says spreading the bad debt throughout the financial system was good "in theory"

Presidential Debate, Sept. 26,2008 "Obama:...Two years ago, I warned that, because of the subprime lending mess, because of the lax regulation, that we were potentially going to have a problem and tried to stop some of the abuses in mortgages that were taking place at the time. Last year, I wrote to the secretary of the Treasury to make sure that he understood the magnitude of this problem and to call on him to bring all the stakeholders together to try to deal with it." Source: http://cnn.com/2008/POLITICS/09/26/debate.mississippi.transcript