Corrupt Government Sponsored Enterprises GSEs
What are GSEs? Privately held corporations with public purposes created by the U.S. Congress to reduce the cost of capital for certain borrowing sectors of the economy. Members of these sectors include students, farmers and homeowners.
GSEs carry the implicit backing of the U.S. Government, but they are not direct obligations of the U.S. Government. For this reason, these securities will offer a yield premium over Treasuries. Some consider GSEs to be stealth recipients of corporate welfare. No way!!!
The financial debacle that is Fannie Mae and Freddie Mac, two GSEs, just keeps getting more disgusting. As in any national crisis the office of president is first on the list when handing out blame. But the blame spills over onto the Congress (including Democrats, say it isn't so!) as much as or more than the president. In fact, The White House called for GSE reform (specifically Fae and Mac) 11 times betwen April 2001 and December 2007 and 17 times in 2008 alone.
The House finally passed a bill in spring 2007. The Senate waited until 2008 to pass it. This bill allowed Henry Paulson (Treasury Secretary) to put Fannie and Freddie into conservatorship but it was obviously way too late.
Why would Barney Frank, ranking member of the House Financial Services Committee (in charge of oversight) wait so long to do something? One reason might have been because he was in a sexual relationship with Fannie Mae executive Herb Moses. Can you say CONFLICT OF INTEREST?
Besides that, it's racist to not offer loans to people who can't pay them back, at least to Barney Frank and a lot of Democrats. How did they come to this conclusion? Well, everybody knows that the GOP likes to punish poor people. Stupid people, why be poor when you can be rich? Anyway, despite the fact that many white people are poor, there are non-whites who are also poor. So, that makes anyone who questions lending practices that would give poor people home loans a racist. No other explanation. One more example of how political correctness is bringing this country to its knees. Granting politically correct loans is more important than granting financially correct loans.
I hate people who think racism is a one way street (whites discriminating against non-whites). Racism is alive and well in ALL GROUPS/ETHNICITIES and it travels in all directions.
Let's not forget how Mae and Mac used their political power to lobby Congress in efforts to interfere with investigations of their "accounting errors". We're talking about billions of dollars in "errors".
Fannie Mae - Federal National Mortgage Association - FNMA
Freddie Mac - Federal Home Loan Mortgage Corp - FHLMC