|
Also, let's all just use logic for a moment.
The current credit crisis has been caused by the toxic mortgage securities that are on bank balance sheets. Until they can unload them OR put a value on them, they can't loan money because of reserve requirements.
IF those securities conformed to Fannie and Freddie standards, they could very easily sell them to Fannie and Freddie for FULL BOOK VALUE and go on with life.
The problem with the securities that are clogging up the system is that they DON'T CONFORM TO FANNIE AND FREDDIE STANDARDS, and that's why they're sold on the open bond market.
Fannie and Freddie loans are already guaranteed by the government, by virtue of the government taking them over. So while they did contribute to the overall housing bubble and subsequent pop, they have absolutely nothing to do with the current credit crisis or the $700 billion bailout package or the current carnage on Wall Street.
__________________
sig too big
|