President Bush may be over Freddie and Fannie by Monday.

[coadie]

Banking financial market news.

WASHINGTON — Senior officials from the Bush administration and the Federal Reserve (http://topics.nytimes.com/top/reference/timestopics/organizations/f/federal_reserve_system/index.html?inline=nyt-org) on Friday called in top executives of Fannie Mae (http://topics.nytimes.com/top/news/business/companies/fannie_mae/index.html?inline=nyt-org) and Freddie Mac (http://topics.nytimes.com/top/news/business/companies/freddie_mac/index.html?inline=nyt-org), the mortgage finance giants, and told them that the government was preparing to place the two companies under federal control, officials and company executives briefed on the discussions said.

We are wanting to extend more home mortgages while at the same time protecting people that have invested in mortgage banking. According to headlines, the only loser is the person who faces forclosure on a home in which he never invested equity.

There are a lot of stake holders.

The construction companies and workers
home owners,
Banks
Real Estate backed securities holders and
others.
Home owners.

Liberal lending doesn't work when the selling price falls later.

A side note.
There is a lot of fraud in filling out home loan applications. The largest state for the same was UTAH.

Inflation of building materials is another matter.

This whole mess is far more complex than it looks. Demand for construction in China has excalated costs of re bar and concrete for example. That is bad. It has helped exports of the same and also construction machionery. That is good.

If intereset rates go up and prices go up, sales of house tralors will go up. That industry was depressed for years except for the SURGE of FEMA trailors.

recent hurricanes will help the construction numbers after insurance settlements.

all these related sectors will recover.

[coadie]

WASHINGTON — A top House Democrat confirmed Saturday that the government is planning to intervene to stabilize troubled mortgage finance companies Fannie Mae and Freddie Mac.
Rep. Barney Frank, D-Mass., the chairman of the House Financial Services Committee, said in a statement that Treasury Secretary Henry Paulson "intends to use the powers that Congress (http://www.foxnews.com/story/0,2933,418081,00.html#) provided it" in a law passed in July to enable Fannie Mae and Freddie Mac to keep functioning.
But Frank, who spoke with Paulson late Friday, said he did not "know the details of the proposed interventions," and a Treasury spokeswoman declined to comment.
A person briefed on the matter Friday said the government was planning to take over both companies, which together hold or back half of the nation's mortgage debt.

The CEO seems to not be earning the $38 million a year they pay him. Can anyone explain why a loser gets paid so much?

[coadie]

Douglas Holtz-Eakin has been updated. He is John McCains economic advisor.

Obama has to replace
Rezco as his economic adviosr. Rezco will be making collect calls from jail.

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WAMU joins this par and recieves Gov oversight.

WAMU is noted for liberal and exotic mortgage practices. It is a detrimental strategy for the borrower if anything goes wrong.

NEW YORK (Reuters) - Washington Mutual Inc, the largest U.S. savings and loan, ousted Kerry Killinger as chief executive and was put under special regulatory supervision following skyrocketing losses from mortgages that are expected to weigh on results for years.

[coadie]

It is coming out. Apparently the Fed is getting Prefferred stock. Outstanding equities from the Old freddie andOld Fannie have little value now. The US is actually getting a good yield on the Preferred. some foreign governments that hold investments now feel safer. Every state has a few banks that hold some stock and that is almost worthless.

[coadie]

Ken Lewis got the big phone call Sat AM. BAC bought Merril. Now AIG is on the rocks today and Lehman went bellly up. AIG has assets and Lehman was missing equity. Ken Lewis didn't really say why these are all folding other than excessivve leverage and greed. He did say Freddie and fanjie were poorly run and wasting energy fighting for market share disregarding conservative decissions.

[coadie]

Ken Lewis got the big phone call Sat AM. BAC bought Merril. Now AIG is on the rocks today and Lehman went bellly up. AIG has assets and Lehman was missing equity. Ken Lewis didn't really say why these are all folding other than excessivve leverage and greed. He did say Freddie and fanjie were poorly run and wasting energy fighting for market share disregarding conservative decissions.
1999 NY Times Article Revealed True Cause of Current Fannie Mae Crises

By P.J. Gladnick (Bio (http://newsbusters.org/bios/p-j-gladnick.html) | Archive (http://newsbusters.org/blogs/p-j-gladnick))
September 25, 2008 - 16:25 ET
<LI class=last_task>http://newsbusters.org/graphics/email.png (http://newsbusters.org/forward/24665)
http://newsbusters.org/graphics/print.png (http://newsbusters.org/node/24665/print)


This is probably an article (http://query.nytimes.com/gst/fullpage.html?res=9C0DE7DB153EF933A0575AC0A96F9582 60&sec=&spon=&pagewanted=1) that the New York Times wishes it didn't have in its archives because it reveals the true culprits behind the current Fannie Mae meltdown. You will find "uncomfortable" truths in this September 30, 1999 article by Steven A. Holmes starting with the title, "Fannie Mae Eases Credit To Aid Mortgage Lending," that you won't find in current editions of the New York Times (emphasis mine):
In a move that could help increase home ownership rates among minorities and low-income consumers, the Fannie Mae Corporation is easing the credit requirements on loans that it will purchase from banks and other lenders.
The action, which will begin as a pilot program involving 24 banks in 15 markets -- including the New York metropolitan region -- will encourage those banks to extend home mortgages to individuals whose credit is generally not good enough to qualify for conventional loans. Fannie Mae officials say they hope to make it a nationwide program by next spring.
Fannie Mae, the nation's biggest underwriter of home mortgages, has been under increasing pressure from the Clinton Administration to expand mortgage loans among low and moderate income people and felt pressure from stock holders to maintain its phenomenal growth in profits.

Get that? Pressure by the Clinton Administration to expand mortgage loans by lowering its credit requirements.

http://newsbusters.org/blogs/p-j-gladnick/2008/09/25/1999-ny-times-article-revealed-true-cause-current-fannie-mae-crises

Lowering credit standards raises default rates. Obama worked for extreme leftist ACORN. It even showed poor minorities how to fill out fraudulent loan applications,

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Dumb Democrats in Denial.

http://www.youtube.com/watch?v=_MGT_cSi7Rs

No wonder there are no hearings in congress blaiming the Republicans.

Freddie and Fannie are not under sarbanes Oxley. They own lobbyists.
Waters says everything worked just fine. Affordible housing is very expensive.

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10 minute story on how Obama sued banks that did not do enough subprime mortgages

http://www.videosift.com/video/Burning-Down-The-House-What-Caused-Our-Economic-Crisis

How democrats fought against oversite at Fannie and freddie. (Which do not fall under Sarbanes-Oxley act