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Fannie Mae and Freddie Mac Run Up Huge Tab for Taxpayers

Posted on Oct 21, 2010
Flickr / (CC-BY)

So, remember that whole bailout thing that began a couple of years ago? It’s not over yet, at least not when it comes to those delinquent housing giants Fannie Mae and Freddie Mac. According to new government projections, the Fannie and Freddie bailout fiasco could run up a $363 billion bailout bill for taxpayers through 2013. And as the Los Angeles Times reported Thursday, taxpayers are now the proud owners of almost 80 percent of both companies—lucky us!  —KA

Los Angeles Times:

The Federal Housing Finance Agency, which has regulated the former government-sponsored enterprises since they were seized during the financial crisis in 2008, said the figure was based on the worst of three scenarios for the economy and housing market that assumes a “deeper second recession.”

Under the best-case scenario, which would be a “stronger near-term recovery” in housing prices, the bailouts of Fannie and Freddie would reach $221 billion. The third scenario, in which housing prices continue on their current projections, would result in the combined bailouts reaching $238 billion.

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By lasmog, October 22, 2010 at 1:07 pm Link to this comment

It is truly amazing what American elites can get away with.  From starting needless wars to crashing the American financial system, they seem completely above the law.  What I find most perplexing about all this is the indifference evinced by most Americans. I feel that I am awake among a nation of sleepwalkers.

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By Bushfatigue, October 22, 2010 at 12:18 pm Link to this comment

As purchasers of junk mortgages, and sponsoring mortgage pools, I guess as the paper they hold is declared to be worthless, these two institutions need this money to replenish their capital to continue to buy mortgages?
But for some of the mortgage and mortgage pools they guaranteed, I have a sinking feeling that they are paying off some of the banks and investors who created this junk, and contributed to this disaster—in another time, or another world, Fannie and Freddie would to be suing the bankers who created, sold or rated this worthless paper.

But I guess we should just quietly accept that like any good third world country, our elites are not going to be held accountable for the disasters they have visited upon our country, whether in the form of financial crimes or war crimes. 

Hell, even the pundits who helped lie us into a disastrous war, or at least urged is on with promises of “cake walks”, and who still agitate relentlessly for an attack on Iran, have suffered no consequences for being so disastrously wrong either.

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