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Dougie944
16 years ago

Nice job of putting that into
Nice job of putting that into a way for people to understand what has happened here.

Maybe, now that Freddie and Fannie are fixed, they can take on even more of the IB’s bad investments.

In the meantime, I suggest everyone get a copy of Rosetta Stone’s Mandarin Edition and do a little brushing up.

jpinpb
16 years ago
Reply to  Dougie944

I think after all the
I think after all the Deep-Fried food I’m gonna have a heart attack.

Well, it almost feels like it. Every day more demoralizing news.

ucodegen
16 years ago

** I want a divorce!!! **
** I want a divorce!!! **

4plexowner
16 years ago

Failure of the GSEs was
Failure of the GSEs was sooooo hard to see coming …

http://piggington.com/fed_monetizing_fannie_and_freddie

edna_mode
16 years ago

I’ll see your dramatic story,
I’ll see your dramatic story, and raise you with some dark humor (warning: it’s a bit gruesome):

http://preview.tinyurl.com/6mc74v

A fictionalized future? Perhaps…

cr
cr
16 years ago
Reply to  edna_mode

The government’s age old task
The government’s age old task of keeping people scared enough to not revolt, but not so scared they panic and take out all their money…oh, wait, that’s happening?

Obviously they didn’t learn from Bear Stearns.

I look forward to the day they realize they should have just let the market correct itself.

Anonymous
Anonymous
16 years ago

Is it just me or does it seem
Is it just me or does it seem like the FDIC is shirking its duties to depositors, to benefit homeowners:

http://online.wsj.com/article/SB121607890530252639.html?mod=rss_whats_news_us

Does the FDIC really think they will get more out of a foreclosed home in a month or year’s time than they would now?

Seems like a backdoor bailout to me.

DWCAP
16 years ago

It was the best of times
It

It was the best of times
It was the worse of times……..

The tale of two markets, the stock market and the houseing market. Tied together, but both living in a vacume, and moving in different directions.

Dougie944
16 years ago
Reply to  DWCAP

Am I missing something….
I

Am I missing something….

I thought the stock market and housing were moving in the same direction.

I challenge you to point out the best of times part of the economy. I can come up with the worst of times list myself.

Dougie944
16 years ago
Reply to  DWCAP

Am I missing something….
I

Am I missing something….

I thought the stock market and housing were moving in the same direction.

I challenge you to point out the best of times part of the economy. I can come up with the worst of times list myself.

barnaby33
16 years ago

I found the fried clams part
I found the fried clams part to be the most subtle and entertaining, an allegory in itself. I do wail for the poor innocent children though, won’t somebody please think of the children? You never actually see DBIL’s children, but they are implied as hovering just offstage to the left.

DWCAP
16 years ago

damnit, that was suppose to
damnit, that was suppose to say moving in the SAME direction (down). Need to lay off the sauce when posting on here.

As for the best of times, if you are in oil, commodities, mining, US based exporter of mechanical goods(ie cat), alternative energy, or maybe just aspire to be an FDIC regulator, things are looking pretty good right now.

I was very poorly trying to show that even though alot of things are afoot in many different markets, it is all connected, regardless if BB or paulson claim it is or isnt. A revolt in one will cause unforsceen events all over the place.

qcomer
16 years ago

Rich,
Your analogy has a

Rich,

Your analogy has a basic problem which shows your misunderstanding of this issue. The dire financial situation of your step brother doesn’t really effect you except from some emotional baggage from your spouse. But in reality, the collapse of Freddie and Fannie will definitely effect the US citizens, US economy and financial system. It will make it impossible for you to get a mortgage. So closer analogy would be if your only customer was your step brother’s business or something.

So like it or not, but we all will have to pay for the greed, stupidity or misfortune of some in this country. We all share the cost of govt involvement in case of terrorist attacks, Iraq war,Spending on missile programs, etc when everyone doesn’t agree with it. I know that this is different from those situations but you can’t tell that to millions of people losing their jobs/homes.

barnaby33
16 years ago
Reply to  qcomer

It will make it impossible
It will make it impossible for you to get a mortgage.

Impossible, or just much more expensive? Id say the supposition that its possible to borrow money for a 30 year period at 6% is what should be impossible. Nobody in their right mind can predict what will happen in 30 years. All mortgage subsidies did was make houses more expensive over time. They neither enlarged the supply of houses, nor the buyer pool.

Fannie and Freddie collapses will have huge repercussions on our economy that much is true. However it is the distortions that they caused by artificially lowering borrowing costs that were the real problem.

qcomer
16 years ago

Rich,
I didn’t mean to

Rich,
I didn’t mean to criticize you, just the analogy you made. I have been a great fan of your work, this website and you were definitely among the first, calling out this liquidity bubble. I agree like the Iraq war, we shouldn’t have made the mistake of inflating this bubble or invading a country. But we can only look at future and the whole issue of how to handle this economic crisis doesn’t seem to have simple answers.

urbanrealtor
16 years ago
Reply to  Rich Toscano

Rich Toscano
[quote=Rich Toscano]

@urbanrealtor – What does the supreme court have to do with it? They haven’t done squat and they aren’t going to (even though Volcker himself has suggested that what the Fed’s been doing is borderline illegal).

Rich[/quote]

Embarassed. Well the issue here is that I missed the allegory. The comment section and the extended version of the post really should be on the same url. See I thought the “you” and “spouse” were branches of government (legislative (senate hearing) and executive (Paulson and Bernanke).
However while I did miss the whole “read more” thing, I stick by what I said. As an analyst (in whatever form that takes) it is always a temptation to slip into the role of the contrarian. The post was not up to your usual standards of analysis.
Also, could you give a citation for Volker’s thoughts? That’s pretty interesting and I had apparently missed it.

urbanrealtor
16 years ago
Reply to  Rich Toscano

My disagreement was not with
My disagreement was not with the issue. My criticism was that your post was below your usual standards. If your post read more like the paragraph above (minus the histrionic language) it would have been as good as your usual stuff. My intention was not to impeach your motivations. They are, in the final analysis, irrelevant. However, I don’t think it is off topic (or superficial) to criticize your piece as being reactionary. The whole reason that you are one of the most read real estate journalists is because your stuff tends to be analytical and avoid reactionary excess.

As for other topics, (see email—this post is getting long)

urbanrealtor
16 years ago

So I am confused…
Is the

So I am confused…
Is the Supreme Court in this example the 3rd member of a menage a trois or like an affair or just a drunk threesome.

Seriously, calling this informative is like calling Ayn Rand economics (or L Ron Hubbard philosophy).

Its humorous but…well really thats it.

moneymaker
16 years ago

If I could buy a house 12
If I could buy a house 12 cents on the dollar I would do it. So why shouldn’t the government “buy” Fannie Mae or Freddie Mac?

4plexowner
16 years ago
Reply to  moneymaker

Because we, as taxpayers,
Because we, as taxpayers, have to cough up the other 88 cents?

moneymaker
16 years ago
Reply to  4plexowner

Wouldn’t it be the investors
Wouldn’t it be the investors that would be coughing up that 88 cents. I’m not advocating a bail out but a buy out, a takeover. Like it happens in the real business world.

cr
cr
16 years ago
Reply to  moneymaker

No, because the investors are
No, because the investors are predominantly foreign, China being the largest. They’ll dump the rest of our money back on us and call it worthless if we don’t throw ’em a bone for the reckless investing into poorly managed GSE’s.

Keep in mind this is Helicoptor boy. He’ll give money to anyone who has proven to manage it poorly.