Fannie and Freddie: Why Government F's Up - Page 3

Spideynw · 07-16-2008, 03:30 PM

The United States is screwed. Contracts are not sacred anymore. The government does not give a shit about them. Our property is not sacred. The government will rob us of our wealth by printing new money at a whim. I do not even try to really keep track of how much my wife and I are spending anymore. I have no idea what my dollars will be worth tomorrow or how much of what I earn I will actually get to keep. And if I get in trouble, the government will just issue an economic package to save me. Regulations, government backed unions, and patents/copyrights keep competition low, which keeps prices high and/or quality low. A big chunk of my pay goes to old people who are sitting around doing nothing (i.e. less economic productivity). It also goes to old people to pay for more healthcare than they need. My wealth is being sent to other nations in the guise of "foreign aid". My wealth is being spent on soldiers, who do not produce any wealth. We might as well pay them to sit at home watching television. My wealth is taken from me and given to people who make very risky investments in the form of subsidies.

I give up. I will keep working in my piddly little worthless customer service job with my B.A. degree, and when we get into financial trouble, the government will have to take care of us, because the government simply will not let us take care of ourselves. And if the government is going to keep redistributing my wealth to others, then they might as well redistribute that wealth back to me.

Angus_Aboot · 07-16-2008, 04:31 PM

Originally Posted by Spideynw

The United States is screwed. Contracts are not sacred anymore. The government does not give a shit about them. Our property is not sacred. The government will rob us of our wealth by printing new money at a whim. I do not even try to really keep track of how much my wife and I are spending anymore. I have no idea what my dollars will be worth tomorrow or how much of what I earn I will actually get to keep. And if I get in trouble, the government will just issue an economic package to save me. Regulations, government backed unions, and patents/copyrights keep competition low, which keeps prices high and/or quality low. A big chunk of my pay goes to old people who are sitting around doing nothing (i.e. less economic productivity). It also goes to old people to pay for more healthcare than they need. My wealth is being sent to other nations in the guise of "foreign aid". My wealth is being spent on soldiers, who do not produce any wealth. We might as well pay them to sit at home watching television. My wealth is taken from me and given to people who make very risky investments in the form of subsidies.

I give up. I will keep working in my piddly little worthless customer service job with my B.A. degree, and when we get into financial trouble, the government will have to take care of us, because the government simply will not let us take care of ourselves. And if the government is going to keep redistributing my wealth to others, then they might as well redistribute that wealth back to me.

What a peculiar breed of freedom fighter you are.

saabguy · 07-18-2008, 01:43 PM

Originally Posted by WickedLou9

I think that nightmare is why fannie and freddie will not go under. The government simply won't allow it.

exactly correct. there is too much at stake to allow such a thing to happen. it would be like shutting the doors to the US Postal Service tomorrow...not going to happen.

two other comments, most fannie/freddie loans would not be hard to re-finance out of...it wasn't their type of loans that started the whole sub-prime mess. they're pretty standard and have pretty stringent guidelines, it's still pretty much "A-paper" loans. Also, the FED does not control the mortgage interest rates. they control the overnight lending rates, which control short-term interest rates (credit cards, car loans, anything tied to prime). that is very different than a 30-year fixed investment, which is controlled by wall-street and the trading of "Mortgage Backed Securities." historically, whenever the Fed cuts the rate, mortgage rates go higher in response because investors are chasing the short-term and pulling money from the long-term markets. it also spikes inflation, which is bad for a 30-year loan...

DosEquis · 07-18-2008, 02:10 PM

How come... when huge banks like citi and wells fargo come out and say "well we didn't lose as much as we thought" it is good news? I mean i understand its good in a way, but the impact it has its just incredible. Its like "oh...its just shitty instead of real shitty"...and it gets reported as good news? i am confused.

WickedLou9 · 07-18-2008, 02:18 PM

Originally Posted by DosEquis

How come... when huge banks like citi and wells fargo come out and say "well we didn't lose as much as we thought" it is good news? I mean i understand its good in a way, but the impact it has its just incredible. Its like "oh...its just shitty instead of real shitty"...and it gets reported as good news? i am confused.

It's mostly about expectations. If people expect them to lose 3 billion, that expectation will be factored into the price that people are willing to buy Citi at. If they report earnings that are better than what was expected, suddenly people will be willing to pay a higher price for the same stock because it's actually worth more.

nbiggershaft · 07-19-2008, 12:12 PM

Originally Posted by saabguy

exactly correct. there is too much at stake to allow such a thing to happen. it would be like shutting the doors to the US Postal Service tomorrow...not going to happen.

two other comments, most fannie/freddie loans would not be hard to re-finance out of...it wasn't their type of loans that started the whole sub-prime mess. they're pretty standard and have pretty stringent guidelines, it's still pretty much "A-paper" loans. Also, the FED does not control the mortgage interest rates. they control the overnight lending rates, which control short-term interest rates (credit cards, car loans, anything tied to prime). that is very different than a 30-year fixed investment, which is controlled by wall-street and the trading of "Mortgage Backed Securities." historically, whenever the Fed cuts the rate, mortgage rates go higher in response because investors are chasing the short-term and pulling money from the long-term markets. it also spikes inflation, which is bad for a 30-year loan...

welcome

W.J. Wilczek · 07-20-2008, 09:09 AM

What we are seeing now is the ugly face of deregulation. The current financial crisis precipitated by the subprime mortgage meltdown is the fault of deregulation. If the FDIC, FSLIC, HUD and FTC had done a proper job of regulating the banks and mortgage lenders, and if the SEC had exercised proper oversight of the sale of these mortgage-backed securities, we wouldn’t be in this mess.

Ardentfrost · 07-20-2008, 09:50 AM

Originally Posted by W.J. Wilczek

What we are seeing now is the ugly face of deregulation. The current financial crisis precipitated by the subprime mortgage meltdown is the fault of deregulation. If the FDIC, FSLIC, HUD and FTC had done a proper job of regulating the banks and mortgage lenders, and if the SEC had exercised proper oversight of the sale of these mortgage-backed securities, we wouldn’t be in this mess.

What are you even talking about? We're talking about the MOST regulated industry there is... we're talking about the government side of this regulated industry, and we're talking about an industry that has seen nothing but increased regulation and government support over the years.

Government backed security has always been a bad idea.

thewise1 · 07-20-2008, 01:46 PM

Originally Posted by W.J. Wilczek

What we are seeing now is the ugly face of deregulation. The current financial crisis precipitated by the subprime mortgage meltdown is the fault of deregulation. If the FDIC, FSLIC, HUD and FTC had done a proper job of regulating the banks and mortgage lenders, and if the SEC had exercised proper oversight of the sale of these mortgage-backed securities, we wouldn’t be in this mess.

You just said that we're seeing the ugly face of deregulation, and then citied how they did a horrible job of regulating in the same paragraph.

This is why regulation IS a joke. At least in the context of this much regulation and government backed pseudo-monopoly.

Ardentfrost · 07-20-2008, 05:57 PM

If we see increased regulations result in increased problems, then it seems to reason that increasing regulations further would be silly.

Rouger2 · 07-20-2008, 09:09 PM

I see the same old bogie man here. Who owns the stock in Sallie and Freddie could it be our friends the Chinese and Saudis. We cannot not let our bankers and supplier of oil get hurt. The tax payers must save them just think of what they could do if we didn't. Who pushed for them to buy the risky mortgages. I don't know but have a good guess. Oh our gigantic trade deficit such a wonderful thing.

Smull · 07-21-2008, 12:58 PM

So let me get this straight, when things are going well the shareholders of Fannie and Freddie reap the rewards and make money, but when they fuck up, the taxpayers have to bail them out? So the gains are privatized and the losses are socialized. Fuckin wonderful. Thats hell of a lot worse than socialism my friends, thats corporatism.

Spideynw · 07-21-2008, 07:15 PM

Originally Posted by Rouger2

I see the same old bogie man here. Who owns the stock in Sallie and Freddie could it be our friends the Chinese and Saudis. We cannot not let our bankers and supplier of oil get hurt. The tax payers must save them just think of what they could do if we didn't. Who pushed for them to buy the risky mortgages. I don't know but have a good guess. Oh our gigantic trade deficit such a wonderful thing.

If trade deficits were so bad for us, then shouldn't Africa be fuck'n rich?

Rouger2 · 07-23-2008, 02:18 PM

Originally Posted by W.J. Wilczek

What we are seeing now is the ugly face of deregulation. The current financial crisis precipitated by the subprime mortgage meltdown is the fault of deregulation. If the FDIC, FSLIC, HUD and FTC had done a proper job of regulating the banks and mortgage lenders, and if the SEC had exercised proper oversight of the sale of these mortgage-backed securities, we wouldn’t be in this mess.

Now we are getting at the problem the republicans and george bush. the anti regulators.

Rouger2 · 07-23-2008, 02:20 PM

Originally Posted by Spideynw

If trade deficits were so bad for us, then shouldn't Africa be fuck'n rich?

I don't know but I betcha that most african nations have huge trade deficits, but they get bailed out by the world bank and others.

Spideynw · 07-24-2008, 02:38 AM

Originally Posted by Rouger2

I don't know but I betcha that most african nations have huge trade deficits, but they get bailed out by the world bank and others.

No, no African country has a trade "deficit" with the United States. The U.S. has trade deficits with all of them that we do business with. We have the purchasing power, they do not.

Data - Swivel

WickedLou9 · 07-24-2008, 12:40 PM

Originally Posted by Spideynw

If trade deficits were so bad for us, then shouldn't Africa be fuck'n rich?

Because they don't have anything to sell. They might be able to grow crops... if we didn't subsidize our farmers and dump grain onto the world market at rock bottom prices. They can't compete with us. SO they don't farm and they all starve. Sweet deal.

Rouger2 · 07-24-2008, 12:58 PM

Originally Posted by Spideynw

No, no African country has a trade "deficit" with the United States. The U.S. has trade deficits with all of them that we do business with. We have the purchasing power, they do not.

Data - Swivel

Well then they are gaining and we are losing, but the deficits with Africa are not enough to do them a lot of good but with China and Suadi arabia they are eating our lunch because of the huge billion and billions and billions of dollars in trade deficits we have with them.

Angus_Aboot · 07-24-2008, 01:17 PM

Originally Posted by WickedLou9

Because they don't have anything to sell. They might be able to grow crops... if we didn't subsidize our farmers and dump grain onto the world market at rock bottom prices. They can't compete with us. SO they don't farm and they all starve. Sweet deal.

What do you mean they don't have anything to sell? They have sticks!

http://youtube.com/watch?v=gyGHHxUFY6w&feature=user