Jeremy lassen (![[info]](http://p-stat.livejournal.com/img/userinfo.gif){kind=small} jlassen) wrote,@ 2008-05-07 09:27:00 |
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Freddie and Fannie to need federal bail out in 2010
They are cooking the books to hide their mortgage losses, and postponing the inevitable. They have been refusing to raise the capitol they need in order to fend of their bankruptcy(ie, fall below the 3% core capitol requirement... that is, if you as a bank owe depositors and bond purchases $100, federal law requires you to have at least $3 on hand..). Come 2010, when Freddie and Fannie must realize the above unrealized losses, they will have less then the three bucks to the hundred, and will be bailed out by us.
Instead of raising capitol, and trying to prevent this failure, the folks running the show and Freddie and Fannie are doing what any sane person would do when they know the fix is in... they're getting a piece for themselves. Why try and stay afloat, when you know your going to be bailed out? Just rig the books long enough to ensure that you can get out with your shirt and golden parachute, and leave the tax payers holding the bag.
I'm sooo fucking angry words don't begin to describe it. This shit makes the S&L scandal/crisis/bailout look like lunch money. We're being fucking robbed blind by the financial industry, and nobody in the government is saying or doing anything to prevent it. THIS is Republican fiscal responsibility... let the tax payers pay for rich gamblers losses. FUCK THEM. If you can 't face the results of your actions, you get regulations. If you can't be an adult, you have to be treated like a child. And the last 20 years of republican deregulation (I'm ground zero in the republican test market of Energy deregulation, and I'm still paying for that debacle, thank you.) have demonstrated anything, its that deregulation means funneling public money into the hands of wealthy corporate citizens when the house of cards inevitably tumbles.
How many more times does the American public need to be raped and left on the side of the road before you realize that the nicely dressed republican politician who looks so handsome might not actually have your best interests at heart?
A report released earlier this month by Mr. Lockhart, the regulator, noted that although Freddie and Fannie had a combined $19.9 billion of “unrealized losses” on mortgage-related investments, neither company had reduced its earnings to reflect those declines. That is because they judged the losses to be temporary — in essence wagering that the mortgage market would recover before those assets were sold. Such a wager is permitted by the rules but difficult for outsiders to analyze.
They are cooking the books to hide their mortgage losses, and postponing the inevitable. They have been refusing to raise the capitol they need in order to fend of their bankruptcy(ie, fall below the 3% core capitol requirement... that is, if you as a bank owe depositors and bond purchases $100, federal law requires you to have at least $3 on hand..). Come 2010, when Freddie and Fannie must realize the above unrealized losses, they will have less then the three bucks to the hundred, and will be bailed out by us.
Instead of raising capitol, and trying to prevent this failure, the folks running the show and Freddie and Fannie are doing what any sane person would do when they know the fix is in... they're getting a piece for themselves. Why try and stay afloat, when you know your going to be bailed out? Just rig the books long enough to ensure that you can get out with your shirt and golden parachute, and leave the tax payers holding the bag.
I'm sooo fucking angry words don't begin to describe it. This shit makes the S&L scandal/crisis/bailout look like lunch money. We're being fucking robbed blind by the financial industry, and nobody in the government is saying or doing anything to prevent it. THIS is Republican fiscal responsibility... let the tax payers pay for rich gamblers losses. FUCK THEM. If you can 't face the results of your actions, you get regulations. If you can't be an adult, you have to be treated like a child. And the last 20 years of republican deregulation (I'm ground zero in the republican test market of Energy deregulation, and I'm still paying for that debacle, thank you.) have demonstrated anything, its that deregulation means funneling public money into the hands of wealthy corporate citizens when the house of cards inevitably tumbles.
How many more times does the American public need to be raped and left on the side of the road before you realize that the nicely dressed republican politician who looks so handsome might not actually have your best interests at heart?
