Freddie Mac-No Politics (FMCC)

[Sogo]

Gvt has no interest in protecting free market, at least not as much as most people would like to think. You wonder why they manipulated supply / demand. Well if you think about it, the very existence of the GSEs is an example of distorting supply / demand. i'm long fnma bc I don't think gvt will get rid of em ultimately. But in a truly free market, there would be no guarantee that any entity will buy loans from banks. And the prices of houses would probably be very different, and likely lower after an adjustment period. Any similar such subsidy has similar effects on price. Because there's a guaranteed liquidity of loans in our system, with GSEs buying them, the "true price" of loans and of homes cannot be discovered, and we don't have an actual "free market". It's a distorted market, and for political reasons. Gvt does same thing in many other areas, not just housing.