Freddie Mac seeks 31 Billion more from Uncle Sam

[Rman]

WASHINGTON – Freddie Mac, facing mounting damage from the U.S. housing crisis, said Wednesday it will ask the government for nearly $31 billion in additional aid after posting a gargantuan loss of more than $50 billion last year.

http://tinyurl.com/cqyd6o

Holy hell at the losses.  Only within a year, too.

[Van Cruncheon]

yup, zombie banks are no-one's friend. the point of nationalization is to gut 'em and replace 'em, not to play weekend at bernies. the freddies and fannies of japan cost that country 9+ years of growth. i don't think you'll find krugman or roubini in any disgareement, here.

[Cheebs]

just nationalize these fuckers and get it done with already, obama's detractors already think he is a socialist.

[siamesedreamer]

*flush*

[ToxicAdam]

F&F should have never been allowed to be traded on the open market. An organization so big and so vital should not have to answer to the whims and greed of the stock market. They drove the industry because of their size and inherent advantages (granted from the government). Once Freddie was allowed to be traded openly, the managers began to take/make riskier loans all in the name of increasing profits (and increasing share value). They were so successful (during the start of the bubble) they had to HIDE profits as to not tip off investors that they were dealing in such wildly fluctuating   investments.

Here's a good article written in 2005 about F/F: http://www.mises.org/story/1765

[Van Cruncheon]

well, that's the first not totally insane article i've read from mises.org, so points for the shock factor.

but a good article? the first half is spot-on in describing the ills at the fhl banks (as you've listed), but throws about so much such spurious and one-sided argumentation that i'm not sure how i'd effective circumscribe all of it except as: GOVERNMENT IS BAD. IF GOVERNMENT BANKING HADN'T MADE LOANS TO FILTHY POORS AT UNCOMPETITIVE LEVELS, COMPETITIVE BANKS IN THE FREE MARKET WOULD HAVE. THEN THOSE COMPETITIVE BANKS WOULD HAVE BEEN COMPLETELY TRANSPARENT AS PER THE RULES OF FREE MARKET COMPETITION. THUS GOVERNMENT BANKING IS BAD.

and that sounds vaguely plausible (if you've chugged the ron paul kool-aid) except, y'know, september 2008, when the free market's own obfuscatory "innovations" -- y'know, the same shit these evil evil "gse's" practice --  brought the market to its knees. points to the rothbard wackos in spotting the symptoms, i guess, but please keep them out of pathology.

[Olivia Wilde Homo]

I'm cautious about reading articles from mises.org or lewrockwell.com

Is it worth the read?

[Van Cruncheon]

yeah, if only to be informed about the crazy of the other side, and this one is less spittle-flecked than usual even if it tries to fit the pieces into the same dali-esque view of economics

[ToxicAdam]

These two organizations hold 5 TRILLION dollars in debt, are the largest lender to the middle class and until a few years ago held the near majority of sub-prime loans in America. To deny their influence, is to deny reality. Their deceit and fraud extended well beyond the bad loans made to "dirty poors" that you attempt to deflect with. Bad loans were made to all socio-economic types of people.

They are organizations that were run by ex-politicians (mostly democrats), not bankers. Often paying themselves salaries in the 10-20 million dollar range. They pay no taxes, have a huge line of credit with the treasury and do not have the levels of transparency that other corporations have to endure.

But, it was not just the American public that had a stake in their excess. 1.7 trillion dollars of foreign money was invested into these companies, because they were seen as "safe bets".

In 2006, we sued Fannie execs for 115 million dollars in compensation. We received back 3 million and (now) worthless stock options.

It's just unfortunate that they became some sort of political football. Republicans only sought to regulate them because they were a Democrat sacred cow. Democrats only sought to protect them because of their influence over a select few powerful congressmen.

[Van Cruncheon]

i'm not denying any of that. i'm denying the conclusions of the article -- that free markets would have been any better. not for one second do i dispute the idea that freddie/fannie were grossly mishandled. the writer clearly identifies all the SYMPTOMS; it's his diagnosis that's wrongheaded.

[Rman]

like their marxist opposition, libertarian economists can prove remarkably astute at analysis, but fail in the solution department because they are, if nothing else, ideologues.

Have you not heard of the power of the invisible hand, Cohen?
</sarcasm>

[ToxicAdam]

Why are we talking about this petty shit when Bristol Palin just became a baby's mama?

ANCHORAGE, Alaska (Reuters) - Bristol Palin, the 18-year-old daughter of Alaska's governor and last year's Republican vice presidential candidate, Sarah Palin, has split from her fiance Levi Johnston, celebrity magazine People reported Wednesday.

The break-up happened "a few weeks ago," People reported, citing an unnamed source it said was close to the couple.

Bristol, whose pregnancy briefly occupied the headlines during her mother's vice presidential campaign last year, gave birth to a son named Tripp in December, fathered by Johnston.

The teenage pregnancy was an awkward moment for the vice presidential candidate, whose campaign supported sex education in public schools that encourages abstinence.

Family values