really big bailouts - FDMC-FNMA
From the day they were guaranteed they couldn't fail because they could tap our tax money...there was no incentive to do anything to improve or to raise new capital.
To me - this is an important political and financial topic in the US. It is also a topic where the voice of the public might have some effect on the outcome. The only practical way for the government to "bail" FNMA and FDMC - is to buy out the stock at rock bottom pricing - and sell off the mortgages held - and close down these two boondoggles.
Yes - eliminate them instead of pouring billions after billions into private investor pockets. The profit to investors in a government takeover should not be a consideration! Without FEDERAL funds - these two companies will fail and investors will lose all. It is imperative to save the mortgages as failure to do so would be catastrophic to the economy.
Encourage small lenders and small mortgage companies to buy and HOLD mortgages again as they used to - before the big companies began selling off mortgage paper anywhere and everywhere to generate stockholder profits with no restrictions on how these financial instruments may be sold.
Government may be right to bail out these two mortgage holders - but once acquired, they should be phased out and closed down.
kay
Sal
When the Roads and Paths end, learn to guide yourself through the wilderness
Beyond the Path