Fannie Mae, Freddie Mac Changes Sidestep Real Problem
March 21, 2008 by Jacqueline L. Jones
By now you’ve probably heard that the government on Wednesday reduced requirements for the cash cushion at government-sponsored lenders Fannie Mae and Freddie Mac by one-third. The move is part of a plan to provide an additional $200 billion of financing for home loans, allow the companies to refinance shaky subprime mortgages into mortgages with more favorable rates, and back them with guarantees from the government. Proponents believe this will stabilize the housing market.
Some government officials are concerned that changing mortgage terms for troubled lenders, who created this mess in the first place, will make mortgage rates higher for everyone. Rates are rising anyway, in spite of drastic rate cuts by the Fed.
The perpetrators of these crimes should be held accountable. Why are taxpayers being made liable for this mess again? Am I wrong, or is this the second government bailout for corporate America in a week? The first was unavoidable due to prior government inaction. This looks like more of the same.
Maybe this long, annoying presidential campaign will turn out to be a blessing. Let’s make sure we grill these candidates on domestic and financial issues before we cast any more votes in the primaries or the general election this November. Cast your vote based on knowledge and not on fear.
Cabinet choices of the eventual winner also deserve more scrutiny. The country and the world are too complex to be run by people with a string of degrees and no common sense.
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[...] FreedomWide.com- Mortgage & Real Estate Headlines â?? Up To The Minute- Mortgage &… wrote an interesting post today onHere’s a quick excerpt By now you’ve probably heard that the government on Wednesday reduced requirements for the cash cushion at government-sponsored lenders Fannie Mae and Freddie Mac by one-third. The move is part of a plan to provide an additional $200 billion of financing for home loans, allow the companies to refinance shaky subprime mortgages into mortgages with more favorable rates, and back them with guarantees from the government. Proponents believe this will stabilize the housing market. Some government o [...]
[...] The Democratic Daily wrote an interesting post today onHere’s a quick excerpt By now you’ve probably heard that the government on Wednesday reduced requirements for the cash cushion at government-sponsored lenders Fannie Mae and Freddie Mac by one-third. The move is part of a plan to provide an additional $200 billion of financing for home loans, allow the companies to refinance shaky subprime mortgages into mortgages with more favorable rates, and back them with guarantees from the government. Proponents believe this will stabilize the housing market. Some government o [...]