Fannie Mae-No Politics (FNMA)

[navycmdr]

Paulson finally explains how he bilked billions from the subprime crash

“We shorted New Century, Fannie Mae, Freddie Mac, Citibank, Washington Mutual, IndyMac, Bear Stearns, Lehman Brothers, and we were 100% right."

https://mailchi.mp/shredmedia.com/loandepot-faces-allegations-how-paulson-bilked-billions-cfpb

Speaking of echoes of the subprime crisis, John Paulson explained his famous bet against the US housing bubble in a recent episode of Finanze, a podcast hosted by Logan Lin, a 17-year-old student at a California high school.

The billionaire investor detailed how he anticipated the housing market's collapse, shorted about $25 billion of securities, and scored a $15 billion windfall.

His wager was immortalized in the book "The Greatest Trade Ever: The Behind-the-Scenes Story of How John Paulson Defied Wall Street and Made Financial History."

Paulson discussed shorting a slew of Wall Street banks, mortgage lenders, and credit-rating agencies during the mid-2000s housing boom. He also touched on his philanthropic pursuits and offered some advice for young people choosing a career.

"We focused on the institutions that had large quantities of subprime or poorly performing mortgages,” he tells Lin.

“We shorted New Century, Fannie Mae, Freddie Mac, Citibank, Washington Mutual, IndyMac, Bear Stearns, Lehman Brothers, and we were 100% right."

How did he make correct predictions? Analytics, he said.

"It wasn't a crapshoot for us. We understood the trends of the mortgage market so well that we could almost predict with a degree of precision when the market would default," he said.

"Even though the underlying fundamentals were deteriorating, the market pricing didn't adjust. It was an incredible opportunity to buy protection at very low cost, when it seemed obvious to us that these securities would default," he added.