Fannie Mae and Freddie Mac bailouts caused the current crisis?

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"Moreover, I am cognizant of the interrelatedness of all communities and states...Injustice anywhere is a threat to justice everywhere. We are caught in an inescapable network of mutuality, tied in a single garment of destiny. Whatever affects one directly, affects all indirectly. Never again can we afford to live with the narrow, provincial "outside agitator" idea. Anyone who lives inside the United States can never be considered an outsider anywhere within its bounds."



~Dr. Martin Luther King, Jr.

75% of it. Freddie and Fannie were the first "lending agencies" using the MBS (Mortgage Backed Securities) to fund future lending. Meaning they would sell MBSs to whoever to raise Capital to loan more to others. Fannie and Freddie should have failed back in 2002 or 2003, but it's high stock value allowed Fannie and Freddie to raise Capital through stock shares. Once Banks started to figure out their problems, Fannie and Freddie started to be open about its "assets".

The game was over once it came to light.

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Pioneers are walking all around singing songs about Lenin and they should be shot for it.

Handlebars

"If you are looking for the guilty, you need only look into a mirror"- V

It is inaccurate to say that I hate everything. I am strongly in favor of common sense, common honesty, and common decency. This makes me forever ineligible for public office.
H. L. Mencken

come on you know you wanna play football..

Beagán agus a rá go maith.

Economic Left/Right: 3.75
Social Libertarian/Authoritarian: -2.87

What does that have to do with the bailout?

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"Moreover, I am cognizant of the interrelatedness of all communities and states...Injustice anywhere is a threat to justice everywhere. We are caught in an inescapable network of mutuality, tied in a single garment of destiny. Whatever affects one directly, affects all indirectly. Never again can we afford to live with the narrow, provincial "outside agitator" idea. Anyone who lives inside the United States can never be considered an outsider anywhere within its bounds."



~Dr. Martin Luther King, Jr.

When Fannie and Freddie went under we saw the crisis get bad really quick.

It took 6 months from Bear Sterns (which was just 1 part of the system) fail and be taken over.. and the economy did nothing but burped. When Fannie and Freddie failed (September 7th), Lehman Brothers failed the next week (September 15th), Merrill Lynch is forced to sell itself to Bank of America to keep from failing (September 14/15th), AIG failed ( September 16/17th, it was a two day process), Goldman Sachs and Morgan Stanley are given Commercial Banking status (September 21st).

In a 3 week span 9 Banks of actual size (bigger then IndyMac and its pennies) around the world failed, sold themselves or were given special status. They are are.. Lehman Brothers, Merrill Lynch, Goldman Sachs, Morgan Stanley, HBOS, Washington Mutual, Wachovia, Fortis, and Dexia.


These banks listed were common house hold names. Everyone in the US heard of the US banks on that list. Every European has heard of HBOS, Fortis and Dexia.

And you are saying Fannie and Freddie didn't set in motion the selling off and Higher LIBOR rates? Fannie and Freddie led the start to the seizing of the credit. Nobody wanted to buy MBSs from anyone because they didn't want to get stuck with MBSs that weren't underwritten as so many Banks did when Frannie and Freddie failed.

__________________
Pioneers are walking all around singing songs about Lenin and they should be shot for it.

Handlebars

"If you are looking for the guilty, you need only look into a mirror"- V

It is inaccurate to say that I hate everything. I am strongly in favor of common sense, common honesty, and common decency. This makes me forever ineligible for public office.
H. L. Mencken

come on you know you wanna play football..

Beagán agus a rá go maith.

Economic Left/Right: 3.75
Social Libertarian/Authoritarian: -2.87

Yes, this is the problem with that sound bite video. Its put together in pieces to give the impression that something was said that wasn't. It is a waste of time even watching such stuff, whether "Dems" or "Repubs" are targeted. Its the same as printed "quotes" taken out of context and set forth to mean something other than what the person being "quoted" said. I am surprised at you Finny. And hey, you too, Lumara. I thought both of you had more common sense than to set out such stuff.

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"I was there and I saw what you did.... saw it with my own two eyes"
Phil Collins--In the Air Tonight

Don't ever accuse me of taking anything out of context. Mind you this is what Barney Frank said on CNBC in July 2008..

Barney Frank saying Fannie and Freddie were good..

There is 1 time I agree with O'Reilly on something.. If Barney Frank was in charge of a private company and it's stock fell 90%.. He's arse would be out on the street.

__________________
Pioneers are walking all around singing songs about Lenin and they should be shot for it.

Handlebars

"If you are looking for the guilty, you need only look into a mirror"- V

It is inaccurate to say that I hate everything. I am strongly in favor of common sense, common honesty, and common decency. This makes me forever ineligible for public office.
H. L. Mencken

come on you know you wanna play football..

Beagán agus a rá go maith.

Economic Left/Right: 3.75
Social Libertarian/Authoritarian: -2.87

Another republican lie...the problem of the book keeping was handled. It is not what caused the subprime mess.

Keep the right wing lies going....

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I'm Proud I never Voted For Bush!



PAT PAULSEN FOR PRESIDENT

They have no choice, Affrayer; the truth does not serve their ends...

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The Democrats are very nearly every bit to blame for this mess as the Republicans. It's the corruption of government that has led us here.

Will/can Obama change enough to fix it?

McCain wants LESS regulation - so he's obviously not the man to fix it.

It's not the corruption of government, it's the stupidity of ideology.

A shattering moment in America's fall from power

More at link.