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The Fed Continues to Prop Up Fannie and Freddie…Communist?

Posted on | December 30, 2008 | 4 Comments

Today we learned that the Federal Reserve will begin buying securities backed by Fannie Mae and Freddie Mac in January; in essence, continuing to prop these companies up.  After hearing this news, one must bring back the Jim Rogers video from last July when he stated that the Fed propping up Fannie Mae and Freddie Mac was indeed a horrible idea.  He later made the statement that this act was a “communist” act.  If a government run entity, the United States Treasury, is creating $5 trillion of debt to support a private company, how is this not communist?

The United States National Debt was doubled to nearly 5 trillion dollars in one weekend when the Fed decided to support Fannie Mae and Freddie Mac.  America truly will run out of “bullets” for saving the mortgage lenders.  “The patient has cancer, giving more bandaids is not going to solve the problem.”  The treasury is continuing to use bandaids which eventually will prove to be problematic to the “cancer patients (mortgage lenders).”

Ultimately, what we are learning from the Fannie Mae and Freddie Mac bailout is that the government feels that this is truly their fault.  They urged Fannie and Freddie to lend money to risky borrowers and now they feel compelled to solve the problem.  Sadly, this is creating even more of a problem.  As a good friend of mine stated, “It would be like your best friends mother bailing you out when you filed bankruptcy at the age of 35.”  I could not agree more with his statement.  Let the individual go bankrupt and solves his OWN problems.

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Comments

4 Responses to “The Fed Continues to Prop Up Fannie and Freddie…Communist?”

  1. silverfox
    December 31st, 2008 @ 8:54 am

    I don’t know all the statistics on the current mortgage mess and the latest role of Fannie and Freddie, but where I live most of the problem mortgages were issued for pure speculation on excessively high end beachfront condos and multimillion dollar private vacation homes, all purchased in the belief that a hugh profit would be made in a couple of years. Unless there is some magical turnaround in the economy, there will be continual growing losses on these mortgages for years to come. Again, taxpayers subsidizing the high income folks!

  2. dave c
    December 31st, 2008 @ 1:14 pm

    Everyone is missing the real issue!

    Lack of Jobs!

    Homes are selling for less than it would cost to build them in an economy were labor and materials are cheap!

    Homes are selling for a tenth of what is would cost to build them.

    If people had jobs all these foreclosed homes would be bought up in a minute. Forget about all of this nonsense about subprime mortgages being drilled into our heads by liars, paid off people in the media, or just plain fools.

    There is not a subprime problem.

    There is not a forclosure problem.

    The problem is jobs!

    We have allowed our government to be bought off by political contributions from corporations which offshore every single job they can to bypass 200 years of legislation to protect, child labor, slave labor, the environment to name just a little bit.

    We need 2 laws right NOW!

    Domestic content

    Corporations can only do business in The United States of America if they follow all our federal laws like child labor, slave labor, free speech, environment clean air and water. Otherwise the corporation should not be allowed to sell products in the United States of America.

    Do not blame the corportations for doing what they do best which is make money.

    Blame the legislators for not doing what they are supposed to do which is create laws to protect the citizens of the United States of America from being kicked out of there homes becuase they can not find work that will pay the mortgage payment!!!!

    Fire your legislator unless they create jobs by domestic content, and stopping offshoring of all jobs!!!!!

    Stop listening to liars, fools or the paid off media who get money from companies like Citi who is really Dubia who really is building a city on the ocean with Americans money while we are getting kicked out of our homes!!!!

  3. Jacqueline
    December 31st, 2008 @ 4:56 pm

    We could stop the communism, corruption, & economic slide by allowing freedom & Capitalism to work – as they always have for the USA – eliminate illegals, anchor babies, environmentalists, corporation taxes, income taxes – flat or fair tax – this takes away power of lobbies, DC elitists, & cancerous government – give us liberty, or the USA goes down in flames & takes the globe with it.

  4. Subprime Blogger » The Government Hyping Mortgage Application Data? You Won’t Believe This!
    January 7th, 2009 @ 8:29 pm

    [...] The Fed Continues To Prop of Fannie and Freddie…Communist? [...]

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