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FNMA & FHLMC Bite the Dust

By
Real Estate Agent with Bruce Forge Real Estate 00333941

Dateline - Washington DC

Two interesting bits of news in from the Potomac.  This first item from the Washington Post...

U.S. Seizes Control of Mortgage Giants
Washington Post (09/08/08) P. A1; Irwin, Neil; Goldfarb, Zachary A.


"The federal bailout of Fannie Mae and Freddie Mac involves putting the companies under conservatorship and placing the Federal Housing Finance Agency in charge of their operations and appointment of senior managers. The government has dismissed Fannie Mae and Freddie Mac's CEOs--who will, however, assist in the transition--and will provide capital, if necessary. The plan also calls for a cut in the stake of current shareholders to 20 percent from 100 percent. It additionally will require an increase in mortgage funding by Fannie Mae and Freddie Mac through the end of next year to stabilize the housing market; however, mortgage volume will be reduced 10 percent annually for a decade beginning in 2010 to reduce risks to the overall financial system. The companies--which will no longer be allowed to lobby or engage in other political activities--will be restructured by Congress before 2010."

And this second item ...

"Also with reluctance, Senators (last week) voted to privatize their restaurant and food services.
Year after year, decade upon decade, the U.S. Senate's network of restaurants has lost staggering amounts of money -- more than $18 million since 1993, according to one report, and an estimated $2 million this year alone, according to another.

"The financial condition of the world's most exclusive dining hall and its affiliated Capitol Hill restaurants, cafeterias and coffee shops has become so dire that, without a $250,000 subsidy from taxpayers, the Senate won't make payroll next month.

"The embarrassment of the Senate food service struggling like some neighborhood pizza joint has quietly sparked change previously unthinkable for Democrats. Last month, in a late-night voice vote, the Senate agreed to privatize the operation of its food service, a decision that would, for the first time, put it under the control of a contractor and all but guarantee lower wages and benefits for the outfit's new hires."

Now, then, don't you feel better about the first item after reading the second one? 

Eleanor Thorne
Equity Resources - Cary, NC
Advantage Lending 919-649-5058

Okay then.  Don't expect much change from it!

Sep 08, 2008 09:43 AM
Endre Barath, Jr.
Berkshire Hathaway HomeServices California Properties - Beverly Hills, CA
Realtor - Los Angeles Home Sales 310.486.1002

No wonder they are having problems in the Cafeteria, The Lobby Organisations take the politicians out to lunch and dinner hence they should just get rid of the Cafeteria.... or publish who is actually eating there by name watch how more people will start going there:)))

Sep 08, 2008 10:01 AM
Karen Anne Stone
New Home Hunters of Fort Worth and Tarrant County - Fort Worth, TX
Fort Worth Real Estate

Bruce:  What a misleading headline for your post.  Perhaps it got my attention, and than I read your post... but it really ticked me off.  Sensationalism in journalism... whether on Active Rain, print media, or Fox Noise is just plain trash.  Biting the dust... no way.  If they bite the dust, you might as well dig a hole, and crawl into it... things will be that bad.  No more trashy headlines, please.

Sep 08, 2008 10:13 AM
Keith Webb
Guardant Investments, Inc. - Fullerton, CA
GRI

Bruce:  Very interesting perspective.  I appreciate your point even if some do not "Get it".  It is tough writing to the weakest link but FNMA and FHLMC as we knew them are history....clearly they have bitten the dust.  The secret will be not who is running them but what responsible changes will be made as they will remain the number 1 conduit for mortgages.

Sep 08, 2008 10:40 AM