Tag: Freddie Mac

Who Totes The Note?

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Americans should be furious!  Have we truly lost our minds?  I understand there will always be some Obama-zombies who drank entirely way too much cool-aid and believe Obama is the new Messiah … but what about the rest of us?   Are we really going to sit back in voter apathy, or squabble over the perfect candidate to beat Obama and then simply not vote if our “personal choice” does not happen to win the Republican National Convention?  That is precisely how Obama could win re-election … in fact, that is what he is counting on!! 

Let’s look at a few things:

  • Congress has a 9% approval rating.  64% of Americans rate congress as the least professional and ethical  profession in the U.S.  Pin heads keep talking about how we need to elect experienced representatives to Congress.  Well, if their experience is in amassing trillions of dollars in debt, not passing budgets, partisan brinksmanship, ignoring the will of the people, and voting themselves endless pay raises … fire the bums!   We need Statesman and businessmen … not business-as-usual politicians!
  • Congress has not passed a budget in three years!  They simply rely on “continuing resolutions,” which amounts to living paycheck-to-paycheck as a nation.  When we run out of money … they borrow more.  When China won’t loan us any more, they simple print more!  It does not take an economics degree from Harvard to understand that this is sheer lunacy!  How do you cut money from a budget that does not exist? A balanced-budget amendment is not enough.  That simply means that the “incoming” must equal the “out going.”  There are two ways to do that: 1) Cut spending, or 2) raise taxes.  But with spending out of control … Congress simply cannot raise taxes enough to cover their insane spending spree!   A $15 trillion current debt, a $2 trillion a year shortfall, and an estimated national debt of $30 trillion by 2030 tells us we have to seriously cut spending. 
  • Entitlements have to be looked at as well.  We have created a generation of narcissistic, entitlement-minded  sheeple who expect great jobs where the don’t have to actually work, have plenty of leisure time, and make great money … or if not, the government gives them everything.  That is not the American way.  Americans work hard, sweat, take risks, create, invent, and succeed by the fruits of their own labors … and sometimes they fail!  But they can always try again.  It is the land of equal opportunity, not equal result!  Why do some folks think that they have the right to take from people who work harder than they do? Or that it is the government’s job to provide everyone with a $100,000 per year life-style whether they work or not?
  • We cannot cut defense spending to the point of national weakness!  Obama has weakened us enough with his apologies and inept, bumbling lack of foreign policy.  Iran is six months from nuclear weapons.  North Korea is selling nuclear technology to Iran. Iran is planning war games to practice shutting down the Strait of Hormuz! They also shot down and captured one of our top-secret drones and all Obama can do is ask for it back “pretty, pretty please!”  I don’t think Achmed is very afraid of Obama!!  Ohl!  Wait … Obama says he got Osama Bin Laden ….  so he is a bad-ass President!  However, all he did was give the go-ahead.  Actually, the CIA and the Navy SEALS got Bin Laden with intel gathered by the intelligence machine created under Bush (which by the way, Obama wanted to shut down and Eric Holder wanted to prosecute).
  • Speaking of Eric Holder (our esteemed Attorney General)!  I think “Fast and Furious” was a plan to help the Anti-gun groups in this country make a case for stronger gun control, but it backfired on them.  Total incompetence because Obama hires based on ideology … not qualifications!!  And now American border patrol agents are dead, and 2000 weapons are in the hands of Mexican border criminals.  An American border agent armed with a freaking “bean-bag” gun is gunned down by a Mexican border criminal with a fully automatic weapon!   And  … Holder knows nothing?  Obama knows nothing?  Ahhh!  but … they know enough to prosecute governors, states, and Sheriffs who try to do what they can to protect their border-state citizens!
  • Barney Frank and Chris Dodd should be in prison!  Using Fanny Mae and Freddie Mac, Congress forced banks to make crazy mortgage loans to people who could in no way afford them …. simply to buy democratic votes.  Then when these people, predictably,  could not pay their mortgages, Congress demonized the banks … and useful-idiots  like the “occupy Wall street” crowd fall into lock-step and protest the wrong people … taking the scrutiny away from where it should be … on Congress!  It should be “occupy Washington!”  Do you now why Obama, Pelosi, and Reid embraced the “Occupy Wall street” movement … because as long as they were occupying wall street, they weren’t looking where the should be looking … at an incompetent President and his liberal Congress!
  • People who pay no income taxes are mad at people who pay 75% of federal income taxes for not paying “their fair share!”  An oil pipeline that could create millions of jobs and give America a safe oil supply is shelved so Obama can punish states for rejecting Obama care!  Obama, Pelosi,and Reid spew vitriolic nonsense about Conservatives wanting autistic children to die of downs syndrome, little old grannies to be sent to forced-labor camps to die while performing slave labor stamping out Republican bumper stickers, and that conservatives like to drink toxic water while inhaling smog … and the Obama-zombies listen and believe!  Class-warfare at its finest.  Saul Alinski would be so proud!  The question is … are American voters really going to fall for this nonsense?

Obama’s Report Card:  F-

And who totes the not for this insane foolishness?  … the American tax payer!  How much longer are we going to put up with this!

Senator McCain Warned Americans Of The Pending Fannie/Freddie Financial Fiasco

I heard Democratic supporters blasting away against John McCain for his “Bush” like financial policies and how only Barack Obama has the answers to the current economic crisis facing us due to the collapse of financial giants like Freddie Mac, Fannnie Mae, Bear Sterns, and AIG .

In his speech, which I have included below, McCain somehow managed to predict the entire collapse that has forced the government to bail out (with tax-payer money) Fannie Mae and Freddie Mac and now, AIG.

McCain pointed out the falsification of financial records to benefit executives, including Franklin Raines and Jim Johnson, both of whom are now financial advisers to Barack Obama.

Senator McCain also pointed out the power of their lobbying efforts to forestall oversight over their business practices. He finishes with the warning that proved all too prescient over the past few days and weeks.

Mr. President, this week Fannie Mae’s regulator reported that the company’s quarterly reports of profit growth over the past few years were “illusions deliberately and systematically created” by the company’s senior management, which resulted in a $10.6 billion accounting scandal.

The Office of Federal Housing Enterprise Oversight’s report goes on to say that Fannie Mae employees deliberately and intentionally manipulated financial reports to hit earnings targets in order to trigger bonuses for senior executives. In the case of Franklin Raines, Fannie Mae’s former chief executive officer, OFHEO’s report shows that over half of Mr. Raines’ compensation for the 6 years through 2003 was directly tied to meeting earnings targets. The report of financial misconduct at Fannie Mae echoes the deeply troubling $5 billion profit restatement at Freddie Mac.

The OFHEO report also states that Fannie Mae used its political power to lobby Congress in an effort to interfere with the regulator’s examination of the company’s accounting problems. This report comes some weeks after Freddie Mac paid a record $3.8 million fine in a settlement with the Federal Election Commission and restated lobbying disclosure reports from 2004 to 2005. These are entities that have demonstrated over and over again that they are deeply in need of reform.

For years I have been concerned about the regulatory structure that governs Fannie Mae and Freddie Mac–known as Government-sponsored entities or GSEs–and the sheer magnitude of these companies and the role they play in the housing market. OFHEO’s report this week does nothing to ease these concerns. In fact, the report does quite the contrary. OFHEO’s report solidifies my view that the GSEs need to be reformed without delay.

I join as a cosponsor of the Federal Housing Enterprise Regulatory Reform Act of 2005, S. 190, to underscore my support for quick passage of GSE regulatory reform legislation. If Congress does not act, American taxpayers will continue to be exposed to the enormous risk that Fannie Mae and Freddie Mac pose to the housing market, the overall financial system, and the economy as a whole.

I urge my colleagues to support swift action on this GSE reform legislation.

Now I ask you … who is more intuned to the financial pulse of the nation and the problems it is having. Senator John McCain, who warned us five years ago, of this disaster … or, Barack Obama, the Messiah who will step down from his Greek Temple and turn us all into truly holistic, enlightened, spiritual beings singing Kumbaya and chanting, “Hooooopppppeeeee …. Chhhhhaaaaannnngggeee …. Hooooopppppeeeee … Chhhhaaaannnngggeee!

P.S.

Oh Yeah … About TrooperGate … Folks, this is a non-issue. If that Alaskan State Trooper tasered a 10-year old, he should have been fired. More importantly, the governor should have been pushing for it because the troopers work for, and represents, the governor. Regardless of whether the said trooper was a relative, in-law, or a total stranger … he should have been fired

Beware Government Promises!

This is a copy of Fred Thompson’s article on the Freddie Mac / Fannie Mae crisis.  It is excellent and it could not be said better, so I simply posted it here in its entirety.  People need to be aware of this stuff and understand it.  I don’t think Fred Thompson will mind …  I take no credit for it … just want as many folks as possible to read it.

The Danger of Government Guarantees

I’ll bet it came as a surprise to most folks that the financial stability of the world as we know it depends upon the survival of a couple of outfits called Fannie Mae and Freddie Mac. Yet that’s what the so-called experts are telling us. Moreover, we taxpayers are now being asked to guarantee Fannie and Freddie’s tab, one that could make the $124 billion S&L bailout of the late 1980s look cheap.

So how did we get stuck with this bill? Well, Congress wanted to “do something” about what it saw as a “housing problem.” To them that meant that they should create an even bigger problem.

So Congress passed laws that made it easier for hopeful home-buyers to buy houses … even when they couldn’t afford them. Then the Fed and other regulators helped, in the form of easy money and loose credit standards for mortgages.

Not surprisingly demand for houses grew, home prices rose, lenders financed additional questionable mortgages, fueling even higher prices and so on. You get the picture. This is called a bubble.

Then an amazing thing happened – apparently impossible to foresee. Home prices did not continue to rise forever! Home prices came down and easy money dried up, causing the above mentioned cycle to reverse. In other words, the bubble burst.

So you’d think the in-over-their-heads homebuyers and the mortgage bankers would take the hit, and the market would right itself. No reason for an international meltdown here, right?

Not so fast my friends. Years earlier Congress established Fannie and Freddie as purchasers of these mortgages, which they could bundle up, repackage and sell to investors, freeing up more mortgage money. As government creations tend to do, the two companies grew until they either owned or guaranteed about half the nation’s $12 trillion dollars in mortgages.

Fannie and Fred were “government sponsored enterprises” which means heads they win, tails you lose. If they make money stockholders, creditors and Fannie and Freddie employees – some making millions annually – get the benefit. But now that mortgages have hit the skids, with mounting losses, the taxpayers potentially face trillions in exposure. This is because there is an “implicit” (read “actual”) government guarantee of Fannie and Freddie’s obligations and both are now too big to be allowed to fail. This is called the “bailout phase,” which will probably lead to a bigger bubble in the future.

Lost in this immense, complex mess is the root problem most people are missing: the government is gradually becoming the guarantor of seemingly every important aspect of American secular life, creating incentives and bureaucracies that cause failure and invite fraud.

In Fan and Fred’s case, it was in no one’s interest to turn off the bubble machine. Just the opposite. The system induced borrowers to take on financial obligations they could not afford and lenders to lower lending standards. Fannie and Freddie went along because their managers’ compensation depended on the firms’ short term financial performance. And investors continued to buy complex security packages they didn’t understand, because the securities were viewed as government-backed.

Heavy campaign contributions by those benefiting from this scheme induced Members of Congress to avert their gaze from the ugly mess that was unfolding.

You’d think we’d have learned by now: when the backstop of the federal treasury makes it easier for politicians, lenders, borrowers, welfare recipients, government contractors, or anyone else, to serve their own self interest at the expense of the taxpayer, many will do just that.

That is why we continue to see self-dealing, moral lapses, outright fraud and lack of management and oversight in a wide array of programs and government-sponsored entities, from housing to Medicare, education and the Small Business Administration, all costing taxpayers billions, even trillions of dollars.

Our Founding Fathers knew more than a little bit about human nature. It is one reason why in the Constitution, the federal government was given certain delineated powers and no others. I hate to burst another bubble, but our government simply doesn’t have the authority or the capability to be the guarantor or insurer of our every need or desire. Isn’t it time we started sending that message loud and clear to the big enablers in Washington?

Fred Thompson