Fannie Mae-No Politics (FNMA)

[955]

"By contrast, Corker and Warner's bill, while aiming to reinvigorate the private market, would preserve a government backstop in the form of a new agency, known as the Federal Mortgage Insurance Corp., established to cover the losses of private mortgage insurers in a crisis.

"Most people on" the Senate committee "have come to the conclusion that some type of backstop is a reasonable place to be," Corker said at the Senate hearing later in the day."


FMIC will not work. Recall during the 2008 financial crisis that FDIC was called upon to bail out the banks. Also recall that FDIC had insufficient funds to complete that task and had to resort to theft of other financial institutions to prop up the ones that were too big to fail (i.e., WAMU/JPM, etc.). Now your going to create ANOTHER government entity, FMIC, to bail out an even LARGER entity or group of entities comprising trillions of dollars??? Where is FMIC going to get that kind funding in addition to FDIC busy trying to save the banks?