Fannie Mae (FNMA)

[Donotunderstand]

once chair of the FDIC --- cool


and he notes even those who once hated now .....


And here is the crux as he put it -

(after saying WHAT private capital are we ever going to see?)

So here's the key question for policymakers as they debate this concept of risk sharing by Fannie and Freddie. If we can't identify adequate capital to bear mortgage credit losses when they are incurred, then aren't we setting ourselves up for another series of government bailouts in the next housing downturn? Adequate capital levels at Fannie and Freddie, or any other party who accepts the risk, is the only defense against more bailouts. And while we contemplate this, we should also consider that as long as Fannie and Freddie remain in conservatorship limbo, with the Treasury stripping 100% of their profits each quarter, they're posing a major risk to taxpayers because they are grossly undercapitalized.