The answer is capitalism doesn't work. On Sep 10, 10:08 am, Jim Willis <[EMAIL PROTECTED]> wrote: > Here’s all you need to know. This is an excrement sandwich and we’re > all going to have to take a bite. Some of us will be forced to go back > for seconds. Fannie Mae was foisted upon the American people in 1938 > thanks to the socialist policies of the new deal, thanks Frankie D. > Freddie Mac is Fannie Mae’s evil twin. Not that Fannie is as pure as > the driven snow; quite the opposite. > Those of you suffering from ADD or ADHT might want to double up on > your Ritalin and take notes. > Fannie and Freddie are the largest secondary mortgage buyers in the > country. They are responsible for 50% of all outstanding mortgages > nation wide. Here’s how it works. Let’s say you go to your local bank > for a loan. Most small banks cannot set on your paper for thirty > years. They don’t have that much liquidity, think cash. So, they > bundle your loan with several others and sell them to hedge fund > managers, larger banks or investment houses. Now, these larger > institutions are buying a lot of bundled loans from all over the > country. Here’s where Freddie and Fannie come in. They will buy these > super bundles of mortgages and, “in a bullish housing market” slices > and dices these bundles and sprinkles them throughout the investment > community thereby adding liquidity to he mortgage market, think cash. > What happened? Democrats have been fighting any reform at Freddie or > Fannie. Both quasi private/public companies are overseen by a house > committee. Yet, in 2004 President Bush’s SEC, “securities and exchange > commission” swarmed both companies with federal regulators and found > they were inflating assets to reach bonus targets for their > executives. Not surprisingly both companies were infested with Clinton > cronies cooking the books and setting up enormous golden parachutes > for themselves. > Knowing they were to big to fail and having the backing of the federal > government, “our money” Freddie and Fannie stopped slicing and dicing > mortgages for sale as and investment mainly because investors knew a > great deal of that paper was worthless. Still, both companies hyped > their assets and kept buying. After all, we, as in we the people > guaranteed they could not fail. > As the bottom fell out of the housing bubble Freddie and Fannie saw > their assets plummet. Yet, you have to understand how this incestuous > relationship works. Most of the money Freddie and Fannie accrued to > buy these bundled mortgages they borrowed from banks at short term > rates. Now those notes are due and these companies haven’t the > liquidity, “think cash” to pay the piper. And, a great deal of that > paper they are setting on is worthless. > So, here we are. If Fannie and Freddie can’t meet their debt we’ll > wake up one Monday morning and see two or three hundred banks fail. It > will only get worse. The FDIC, “Federal Deposit Insurance Company” is > insolvent, “think broke”. Then it’s 1929 all over again, yet worse. We > are no longer an agricultural people for the most part. We have > urbanized and become technologically dependent. > What we can do. We don’t have a lot of good choices; between the two > giants they hold 6 TRILLION dollars in mortgage paper. Our current > national budget is 3.1 trillion dollars, that’s perspective. Yes, they > are too big to fail but we can make damn sure this doesn’t happen > again. John Mcpalin has said he would privatize Freddie Mac and Fannie > Mae by slicing them up into a lot of smaller companies and let them > compete with each other without government assurances. As you might > guess, the investment giants aren’t happy with this. Again, if you’re > an investment firm, holding risky paper, you can always dump it on > Fannie or Freddie. That’s why the investment community is the second > highest contributor to Obama behind the trial lawyers. Obama has > received contributions from; Goldman Sachs $653, 030, JPMorgan Chase & > Co $414,760, Citigroup Inc $408,299, UBS AG $389,294, Lehman Brothers > $361,482 and Morgan Stanley $307,221. > And yes, he has accepted donations from Freddie and Fannie. > The answer to this dilemma is as clear as Oprah’s bias against > conservative women. Anything government touches it destroys. And, > America has had enough. I don’t know what it’s going to take but I do > read my e-mails and people are mad as hell. Maybe this is the tipping > point but just in case I’m buying a new pitchfork and cleaning my > musket. > Conservative Springfield 09SEP08 --~--~---------~--~----~------------~-------~--~----~ Thanks for being part of "PoliticalForum" at Google Groups. For options & help see http://groups.google.com/group/PoliticalForum
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