Fanie and Freddie where sort of 1/2 government anyway.

Reader comment on: The WSJ, Fannie, and Freddie

Submitted by Lyle (United States), Nov 11, 2009 22:53

Since they both had the implicit government backing even before the takeover, they had the best possible situation for their stakeholders, the stakeholders get the gains and the taxpayers get the losses (shaft). No such hybrid monster should exist again, either be like ginnie may in which the gov gets both gains or losses or fully private with no gov backing. If they gone bankrupt it would have been an interesting struggle to see if the gov backing would have come thru, a donneybrook likely much larger than tarp. Of course this does raise the question why since Herbert Hoover have politicians favored home ownership. I suspect it's fundamentally about societal stability, as a homeowner is less likely to riot in the streets.


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