Wall St Journal Reports Govt to take over Freddie and Fannie

[slandmarks]

Less than two months ago ...

http://www.breitbart.com/article.php?id=D91V10J00&show_article=1

Bernanke: Fannie, Freddie in no danger of failing

Jul 16 11:10 AM US/Eastern
By JEANNINE AVERSA
AP Economics Writer

WASHINGTON (AP) - Federal Reserve Chairman Ben Bernanke told Congress Wednesday that troubled mortgage giants Fannie Mae and Freddie Mac are in "no danger of failing."

The Fed chief made his remarks as he appeared before the House Financial Services Committee, in his second day on Capitol Hill to brief lawmakers on the problems plaguing the economy. He appears amid a backdrop of fading confidence in the U.S. financial system and in the national economy.


The Fed and the Treasury Department on Sunday came to the rescue of mortgage giants Fannie Mae and Freddie Mac, offering to throw them a financial lifeline.

 

[30ashopper]

Interesting - tuned into CNBC, they had a talking head on there putting forward the idea that this could backfire - instead of lifting F&F up, F&F could drag the treasury down, causing higher interest rates on government bonds, which in turn would cause rising interest rates on residential and commercial loans. In trying to fix the problem, they end up forcing an acceleration of the crisis. I didn't understand all the details entirely, anybody "in the know" on what could go wrong with this?

I got depressed and had to turn CNBC off.

 

[goofer]

The fannie and freddie shareholders are wiped out. the debt holders of fannie and freddie are golden. the banks and financials will rally monday. a major uncertainty is removed from the mkt. this is a possitive for the stock mkt. the mkt will be up triple digits on monday. i will either look brilliant monday or look like a fool.

DJII up 290 points.

Not too shabby a call, right Shelly ?

 

[goofer]

Interesting - tuned into CNBC, they had a talking head on there putting forward the idea that this could backfire - instead of lifting F&F up, F&F could drag the treasury down, causing higher interest rates on government bonds, which in turn would cause rising interest rates on residential and commercial loans. In trying to fix the problem, they end up forcing an acceleration of the crisis. I didn't understand all the details entirely, anybody "in the know" on what could go wrong with this?

I got depressed and had to turn CNBC off.

My advice to you and others is to NOT listen to talking heads. They are almost always wrong and are definitely harmful to your financial health.

 

[AAbsolute]

We're friends right????

DJII up 290 points.

Not too shabby a call, right Shelly ?

How could I have made money with your insight on the day you posted?

 

[30ashopper]

My advice to you and others is to NOT listen to talking heads. They are almost always wrong and are definitely harmful to your financial health.

Well, this talking head was, I believe, a professor of economics.. so I'm going to give him just a little credit.

 

[goofer]

Well, this talking head was, I believe, a professor of economics.. so I'm going to give him just a little credit.

Take Harry Truman's advice. When he was being briefed by economists, the economists would always counsel "on the one hand this may happen but on the other hand that might happen" President Truman said what he wanted was a one armed economist !!

 

[YoungFT]

Watch the price of gold to see if this plan will have a long-term impact on interest rates. If it continues to slide we'll be in ok shape, if it spikes back up over the next 3-4 months we'll be in for a tough 2009.

Only chance for survival is a production boom that generates jobs, jobs, jobs.

How?

Free trade, lower costs on capital formation, reduction in corporate taxes, reduction in corporate welfare like farm subsidies and some sensible laws to lower the cost and expand affordability of healthcare. When this happens housing will pick back up again. Any progress along these fronts is 3-4 years out - there needs to be more pain before idiots in Congress get it together.

 

[SHELLY]

DJII up 290 points.

Not too shabby a call, right Shelly ?

...compared to the 344 drop from last Thursday?

.

 

[SHELLY]

How could I have made money with your insight on the day you posted?

Shorted Fannie & Freddie.

.