Fannie Mae-No Politics (FNMA)

[Donotunderstand]

it is not that simple

first F and F had an insanely low default rate on what it insured

the default rate on its asset portfolio bought from banks (private label MBS) is what bit them harder

and big banks with a monopoly on MBS paper would drive out tons of smaller banks who would no longer have F and F to buy their paper !!!

and the banks would then raise interest rates say by 50% on all but the top FICO over 800 folk

remember it was the banks that lent 100% mortgages (80 10 10 strips) and offered them to people without asking for proof of income

that was not government
that was not F and F

and no it was not banks trying to meet some lofty GOV goal

it was greed and THE BANKS KNOWING YOU AND I WOULD HAVE TO EAT THEIR LOSSES while their equity holders got the profits

And that is what happened the banks predicted that if things got bad enough socialism - society paying along with them - would save them

heads they win
tails we lose

I have no use for the BIG TBTF banks - they are pigs