Saturday, January 02, 2010

What's $400 billion dollars?

Hey what's $400 billion dollars? It is the amount of losses of Fannie Mae and Freddie Mac that you are paying to keep them afloat. And what is wrong with that? We as an economy sure as heck have another $400 billion dollars that we can take out of circulation and help prop up thousands of bad mortgages. Most of these mortgages will never get current. Most of these mortgages should be in bankruptcy now so as to clear the market out of this toxic debt which is still dragging down the housing market. But this administration still feels they are doing a great job and will throw more taxpayers monies out to keep them afloat. And also pay the officials of these two failed mortgages giants $6 million in compensation for the great job they are doing. It is an economic fantasy as to why this money keeps getting spent on Fannie Mae and Freddie Mac to prop up these bad mortgages. And this waste of taxpayer's monies need to stop immediately. We need the free market system to clear the bad debt out and let the normal supply and demand of housing start to go forward again. It is economic reality that not everyone can afford to own a home. The federal government needs to understand it. I am personally tired of paying for this ridiculous piece of social welfare that has failed our economy.

1 comment:

David X said...

Freddy and Fanny are the only institutions - besides the United States Treasury - with authority to monetize their debt through the Federal Reserve. This has distorted the housing market by attracting capital they could not otherwise attract under pure market conditions (because of the implicit government guarantee). This has helped create the housing bubble and economic collapse.

Now that Freddy and Fannie have been given an unlimited checkbook, it amounts to the government nationalizing the housing market in addition to two major car companies, several banks and holding companies. Add to this nationalized health-care and you have an increasingly socialist government and greatly diminished personal liberties.

It's time to take back control, starting with Congress in 2010. These huge swaths of the free market need to be wrestled from the government.