Fannie And Freddie Bailout.

[taxidermist]

Since when does the goverment bailout business?

Why bail the top people out?

Why not pick the lowest income and lowest loan ratio and pay those people out of debt, that would help everyone and trickle up. But wait that would help more than the wealthy people.

[bigredbirdfan]

Fannie and Freddie Mac were setup as part of many administrations (both democrat and republican) desire for everyone to live the American Dream of Home Ownership. They really are just an arm of the government subsidized so that many people who should have been renting (because they are pee poor money managers) could buy a home. There were actual incentives in place for those to make loans they probably knew couldn't be repaid.

And then they stopped paying.

And now another arm of big government needs to be bailed out by you, me and mostly the wealthy who actually believe it or not generate the economic growth necessary to fund all of the glorious government we now have.

So the lesson is if you want something to fail hand it over to the government to run. Like banking, retirement funds (social security) and with any good luck health care so it can suck too. Just wait until everyone is covered and then it is rationed out like Europe and you can't even go see a Dr. Sounds great doesn't it? Better be careful with your votes lately people and not buy into the B.S. that politicians can fix things for you.

[Al Agnew]

Gotta say that...if you want something to fail or otherwise screw up, either let the government run it, OR deregulate it. There is no monopoly on failing programs and businesses. Unchecked greed and lack of scruples is as destructive as government beaurocracies.

[flyfshn]

Worked for a savings and loan here in STL, back in the 80's, that was "saved" by the Resolution Trust Corporation (the government). What a total waste of tax payers $$. The big Blue Chip brought in a CEO that was turning things around, but they had to flex their big muscle and take over.

[bigredbirdfan]

Unchecked greed and lack of scruples is as destructive as government beaurocracies.

I am curious in a qualitative sense which is considered worse?

[mclothier1]

The problem is that the banks sold a bunch of bad mortgages like ARM's (i.e. subprime lending) and now Fannie and Freddie are stuck with them.

Who is to blame?

I would have to say that the banks that sold these mortgages are mostly to blame, but the borrowers are also to blame since a lot of them ended up buying more house than they could afford by going with an ARM instead of getting a conventional 30 year note.

Now Im not a fan of government bailouts, but if the Fed didnt step in and do something, the economy would really be in the crapper. You think its bad now? Oh no! it could be much much worse.

In my opinion, the banking industry lobbied the government to allow such "creative" financing whch was all fueled by the greed of making a fast buck in the Bull housing market, but it didnt quite work out. You would be amazed at how the banking industry is "allowed" to create their own rules.

[Guest kevinkirk]

The problem is that ppl want to have what it took their parents 30 years to get. Kids have new SUV's, boats and huge houses. We walk and see this all the time. NO ONE HELD A GUN TO THEIR HEAD> You have to take personal responsibility.

[flyfshn]

I agree Kevinkirk.....the younger generation want what their parents have NOW, no matter what it costs! I have experience in banking and as a realtor and I can't believe some of the houses people were purchasing. They would take out an ARM loan to qualify for the house and could not afford to furnish it. Never sold one where a customer had to take out an ARM loan, but I saw many of them in the banking industry. That's why they call them Teaser rates!

[Guest kevinkirk]

Why did the KING ranch in Texas get $7 million in govt subsidies last year?

The era of govt handouts to the rich is so horrible. ITs never ending. My neighbors split their farm up and on the internet you can find out who got what and they got $2 million last year plus what they made. How is that for poor farmers. good lord.

http://farm.ewg.org/sites/farmbill2007/reg...0000#searchform

[Guest kevinkirk]

They say only 1 million loans in danger of default. Not like the end of the world. GO TO WORK, get two jobs, work hard, pay your bills. No boats, eating out, toys, vacations, ..oh yea....forgot...that is just not FAIR....and no FUN.....

Good lord. I worked so hard for 30 years and finally debt free. Worked three jobs a lot of the time and saved and scrimped and didnt have the toys. Now ppl say I am JUST LUCKY. Yeah, well lucky I went to work every time the phone rang at 3 am and on call for 30 yrs and wife on call now with 3 phones and a pager. Her sister says..YOU HAVE IT EASY tho.....not likeus. Yep, easy alright is 80 hour weeks while they are going all over hells half acre and spending their retirement monies on toys and cars.

Now they are saying,,,WE just dont know how we can afford to retire...use a whiny nasally voice when you say it to see how it sounds...hahahaha