Replies to post #466956 on Fannie Mae-No Politics (FNMA)

[Guido2]

So did their rich uncle write off the toxic loans in his own books? Or were they written off in the books of his niece and nephew?

[bcde]

"Yes, then the Fed bailed them out via Quantitative Easing and bought all the toxic liability so the GSEs would no longer carry the risk of default. That's what I believe.This explains why the GSEs were able to recover so quickly. They had a rich uncle that had their backs. Uncle Sam. "

YanksGhost,
This is the reason why Gov seized FnF. Only way Gov could have bailed out banks and underwater mortgage owners was to lower the interest rates and allow refinancing. It mostly helped bankrupt banks and mortgage owners. With usury SPSPA, Gov made FnF pay the cost of bailout.

[Commons_Cancelled]

These are great points. Excellent summary