That's true. The ones that really got totaled out were the shareholders that had 100% of their income swept to Treasury. Everyone else got at least some benefit from the conservatorship. Bondholders got paid 100%. GSE creditors got paid 100%. Government got repaid 100%+. The GSEs got a $400 B safety net to backstop against any further crises. And all Fannie Mae and Freddie Mac employees kept their jobs. Banks teetering on the brink got their bad loans cleansed by steering them to FnF. Thousands of delinquent and underwater homeowners had their homes saved by GSE workouts. And mortgage originations continued as the GSEs continued their liquidity efforts, as chartered. Then there are the SCAPEGOATS.
Only the shareholders bore 100% of the pain so everyone else could be kept whole. The crisis is over. Everyone else has been made whole except the government. They have been made MORE than whole. But now the shareholders are required to make further, 100% sacrifices of all their income solely because the government REFUSES to deal with its budgetary disputes. It plays brinksmanship with exceeding the debt ceiling each year. Its deficit grows each year. Government shutdowns are either threatened or actually occur each year. Ad nauseum.
The GSEs cannot continue to have 100% of the income due shareholders appropriated by the U.S. Treasury and spent to float Uncle's Boat. It was one thing to take the action in 2008 that, as obiterdictum's brilliant historical retrospective so eloquently recapped, could have crippled the overall domestic economy and ruined the financial health of institutions and average citizens, everywhere. But that scenario simply no longer exists.
It is time for this chapter in American history to come to a close.
That is my wish for the holiday of everyone's choice. Merry Christmas, Happy Hanukkah, Season's Greetings and a very Happy New Year to all.
