Monday, September 8, 2008

The Right Man at the Right Time

By now most know about the Fannie Mae & Freddie Mac "bailout". It's been blogged, reported & commented about for months. So if you didn't catch it on every major news channel & site this morning, you will.

While some are questioning whether the largest bailout in US history was really necessary, most (experts) say that it was and the fallout from other options (receivership or equity injection) would have been worse.

Paulson: "We had no choice"

And former Secretary of Treasury John Snow said it best on Squawk Box this morning (interviewed in front of the Rotunda at UVA), "This action was necessary in the face of the realities of the financial markets, the need to stabilize housing and the larger issues of the US economy and it's spill over affects on the rest of the world. So we are where we are, I guess now the question is can we find a good path out of this so that we get a permanent solution coming out of the next congress..."

Realty Check (CNBC) on the the housing market will react.
Questions is, "How much and how soon"
Mark Zandi of Moody's Economy, "It will help the housing market, it won't bring an end to the housing downturn immediately though."

I truly feel sorry for the thousands of employees at Fannie Mae & Freddie Mac. This is like Enron times two. "Fannie Mae’s workers had $116 million in the employee stock ownership plan at the end of 2006. Today, it’s more like $17.5 million. Ouch."

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