US Treasury rescue for Fannie Mae and Freddie Mac

[abelenkpe]

US TREASURY secretary Hank Paulson is working on plans to inject up to $15 billion (£7.5 billion) of capital into Fannie Mae and Freddie Mac to stem the crisis at America’s biggest mortgage firms.

The two companies lost almost half their market value last week as rumours of a government bail-out swept the stock markets, hammering share prices around the world.

Together, the two stockholder-owned, government-sponsored companies own or guarantee almost half of America’s $12 trillion home-loan market and are vital to the functioning of the housing market.

http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article4322440.ece


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Uh, with the success of all their other recent 'solutions' isn't this the same as just throwing all that money away?

(edited to add link)

[fasttense]

1. It's just a way take the nation's wealth and hand it over to the bushes. n/t

[asjr]

2. They are just going to borrow the money

from DuBai or China. This country will be in hock until the next century.

[indepat]

3. Just a few days ago, Secretary Paulson said that Fannie and Freddie are well-capitalized

and just a few days earlier said that world oil prices were due only to suppy/demand issues, that there was no speculation in the price and Joe on CNBC's Squawk Box seemingly repeated Paulson's words as fact. Does the Secretary have not a clue or is he just funning us? :shrug:

[Celebration]

4. Nah, just creating his OWN reality n/t

[Celebration]

5. According to Cramer

Bush was ready to throw them under the bus. He doesn't like the idea of Fannie and Freddie and could care less if they are around. So, he was NOT for recapitalizing them. Over the course of one day, Friday, his mind was changed. Someone convinced him that he didn't want to be remembered as being another Hoover.

Seriously, the recapitalizing buys some time so that it can all be dropped into the lap of the next president.