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  • Freddie Mac

    Morning Bell: A Vicious Cycle of Their Own Making

    In what some observers are calling a reshaping of Wall Street, two of the world’s largest investment banks, Merrill Lynch and Lehman Brothers, are set to disappear. Lehman has announced it will file for Chapter 11 bankruptcy protection, and Merrill Lynch was bought by Bank of America. For all the … More

    Mortgage Socialization

    Fannie Mae and Freddie Mac were created during the New Deal by the Roosevelt administration in order increase home ownership. With government backing and price controls, the supply of housing was artificially increased, with the funds coming from the taxpayer. Even when Fannie and Freddie were made into government sponsored … More

    Tapper Wrong, Palin Right on Fannie and Freddie

    This Saturday, Sarah Palin told a crowd in Colorado Springs, CO: “The fact is that Fannie Mae and Freddie Mac have gotten too big and too expensive to the taxpayers. The McCain-Palin administration will make them smaller and smarter and more effective for homeowners who need help.” Now some in … More

    Morning Bell: Big Government Fails Again

    This weekend Treasury Secretary Henry Paulson announced that mortgage giants Freddie Mac and Fannie Mae will be placed in a government conservatorship that closely resembles a bankruptcy reorganization. The move puts U.S. taxpayers on the hook for $5.4 trillion in outstanding mortgage debt and commits the government to provide as … More

    Maybe a Giant Government Mortgage Financing Duopoly is Not in the Interests of American Homeowners

    When liberals in Congress sold the American people on the need to risk $300 billion to bail out banks that made irresponsible loans to bad credit risks, they insisted big government was the answer to the housing crisis. For example, when defending the bill Barack Obama told Tom Brokaw: “What … More

    Morning Bell: The Left's Crony Capitalism Explodes

    Yesterday all three major financial indexes fell after an article in Barron’s reported the Bush Administration is planning to exercise the authority to recapitalize Fannie Mae and Freddie Mac. A Treasury spokeswoman denied the report, but FusionIQ CEO and equity-research director Barry Ritholtz told the AP: “You don’t pass that … More

    Morning Bell: Not So 'Smart' Housing Policy

    This Wednesday, government-sponsored entity Freddie Mac announced that it lost $2.8 billion in just the last quarter alone from foreclosures and other related expenses. Both Freddie, and its sister Fannie Mae, are at the core of the recent housing finance crisis. Freddie and Fannie help finance 40% of all U.S. … More

    End This Mission Impossible

    Freddie Mac CEO Richard Syron told reporters yesterday that Freddie’s dual role as a government sponsored entity charged with creating profit for private investors and serving the public by boosting the housing market is “almost impossible.” We almost agree: Fannie and Freddie are leftovers from an era when giant government … More

    When Congress Fails

    The ‘dean’ of Washington punditry, The Washington Post’s David Broder, has an absolute beaut today on the creation of the National Housing Trust Fund. In an op-ed titled “When Congress Works” Broder writes: If you were to ask Democrats Barney Frank and Chris Dodd — the principal architects of the … More

    Time to End Fannie and Freddie

    President Bill Clinton’s Secretary of the Treasury Lawrence Summers and Heritage don’t always agree. But few experts seem to be satisfied that the new regulator for Freddie Mac and Fannie Mae will be enough to address the systemic risk Fannie and Freddie pose to our financial system. Summers wrote in … More