OT to MarketFest:
Here's a short article discussing a point I made yesterday regarding the open ended checkbook of the US Treasury that tax cheat Tim Geithner has given to the corrupt GSE's Fannie Mae and Freddie Mac. Not only did those two organizations act as the midwife to the biggest financial meltdown since the 1930's, we're now going to fund their stupidity with no limitation through the end of 2012!!! People aren"t paying much attention to this, unfortunately, or they'd be marching in the streets. How many more foreclosures do you think will happen between now and December 31,2012?......Millions! The total liability will probably approach another $2 Trillion. That's money we don't have that we will either have to print or borrow. In either case it will add to our future misery. By the end of the Obabma tenure in the White House in January of 2013 this country will likely owe somewhere in the vacinity of $16 Trillion Dollars. The drag that this will have on the economy, on job creation, on wealth creation, and on the very standard of living we all enjoyed (up til now) will be profound. Anyway, here's the article:
_________________________________________________________________
Lifting Fannie, Freddie Cap Called Policy Disaster
Wednesday, 30 Dec 2009 03:55 PM Article Font Size
By: Julie Crawshaw
Fannie Mae and Freddie Mac got a huge gift this Christmas: The Treasury Department removed the $400 billion spending cap from what the administration believes will be necessary to keep the huge government sponsored enterprises, or GSEs, solvent.
“This action confirms that the decade-long congressional failure to more closely regulate these two government-sponsored enterprises will rank for U.S. taxpayers as one of the worst policy disasters in our history,” Peter Wallison, a senior fellow at the American Enterprise Institute writes in The Wall Street Journal.
“Fannie and Freddie's congressional sponsors — some of whom are now leading the administration's effort to 'reform' the financial system — have a lot to answer for.”
Most of the damage, Wallison notes, was done from 2005 through 2007, when Fannie and Freddie were binging on risky mortgages.
However, new research by Edward Pinto, a former chief credit officer for Fannie Mae and a housing expert, reveals that the GSEs began buying risky loans as early as 1993.
Pinto says Fannie and Freddie routinely misrepresented the mortgages they were acquiring, reporting them as prime when they had characteristics that clearly made them subprime or Alt-A.
By the end of 2008, the two GSEs held or guaranteed approximately 10 million risky loans with a total principal balance of $1.6 trillion that are now defaulting at unprecedented rates.
Since then, under government control, the two agencies have continued to buy dicey mortgages in order to stabilize housing prices.
After mortgage giant Freddie Mac reported a 13 percent drop in mortgage purchases in November, Fannie Mae said its book of business declined at an annualized rate of 6.7 percent in the same month, Housing Wire reports.
© Newsmax. All rights reserved.
News 
Market Data 
Discover 
AI
