Bloomberg: U.S. to Lose $400 Billion on Fannie, Freddie, Wallison Says

[Thiebear]

http://www.bloomberg.com/apps/news?pid=20601087&sid=a2Z5GnTAPcuo

Dec. 31 (Bloomberg) -- Taxpayer losses from supporting Fannie Mae and Freddie Mac will top $400 billion, according to Peter Wallison, a former general counsel at the Treasury who is now a fellow at the American Enterprise Institute.

“The situation is they are losing gobs of money, up to $400 billion in mortgages,” Wallison said in a Bloomberg Television interview. The Treasury Department recognized last week that losses will be more than $400 billion when it raised its limit on federal support for the two government-sponsored enterprises, he said.

The Treasury said on Dec. 24 it would provide an unlimited amount of assistance to the companies as needed for the next three years to alleviate market concern that the government lifeline for Fannie Mae and Freddie Mac, the largest source of money for U.S. home loans, could lapse or be exhausted.

When does it STOP?

When did we authorize the Treasury to do whatever the hell it wanted to without any stop in the Amount?

You know your WRONG when you have to announce it the night before xmas when noone is watching, not even a mouse.

[81artmonk]

I've resigned that by the time Obama runs for re-election China will own the USA. He's printing money quicker than Milton bradley is for it's monopoly games.

What humors me so, is that people will bring up bush, yet Obama has out spent bush in a matter of months for results that aren't working and he plans on doing more of the same. Which I do believe is the definition of insanity isn't it?

[Fight for ole DC]

I think most Americans have no idea what our government is doing....and that's what the government wants.

[DRSmith]

I never understood why the gov't didn't just step in and say" fine we will buy up all the struggling mortgages, provided it is a primary residence and the buyer was honest when applying for the mortgage and offer prime plus one percent"

Everyone else will have to take a hit and next time think before you borrow or lend.

[Hubbs]

I've resigned that by the time Obama runs for re-election China will own the USA. He's printing money quicker than Milton bradley is for it's monopoly games.

What humors me so, is that people will bring up bush, yet Obama has out spent bush in a matter of months for results that aren't working and he plans on doing more of the same. Which I do believe is the definition of insanity isn't it?

This isn't Obama. Hank Paulson effectively nationalized Fannie and Freddie when the bailout was being arranged - which, by the way, was also when John McCain, not Obama, was "suspending" his campaign to make sure that we'd throw $700 billion at the banks so they could "keep lending." (Do you laugh when you read that like I do?)

Just to be clear, I'm not saying that Obama hasn't fully endorsed the bailout strategy, the continuous digging of the Fannie/Freddie Giant Money Hole, and a range of other policies that are all based on the notion that throwing enough money at the problem will magically allow us to enjoy the benefits of bubblenomics without facing the eventual consequences. He has. Whole-heartedly. But so did Bush. So did McCain. So did Paulson, so did Geithner, so did Congressional leaders of almost every creed. If you want to point fingers, stop doing it with blinders on.

By the way, I know great plan for fixing Fannie and Freddie. We can just give yet another booster shot to the first-time every-time homebuyer tax credit, and get even more people to use it. Then, when the government gives the GSEs a bunch of money, it's not a politically-negative "bailout," it's a politically-positive "effort to increase homeownership." And luckily for us, the same people who were so good at doing this sort of thing a few years ago are still in charge! We can't lose!

Just don't ask what happens if we don't keep the tax credits going forever and ever and ever.

[twa]

Deep Doodoo,but it was in the plan

http://www.nytimes.com/2010/01/02/business/economy/02modify.html?partner=rss&emc=rss

The Treasury Department publicly maintains that its program is on track. “The program is meeting its intended goal of providing immediate relief to homeowners across the country,” a department spokeswoman, Meg Reilly, wrote in an e-mail message.

But behind the scenes, Treasury officials appear to have concluded that growing numbers of delinquent borrowers simply lack enough income to afford their homes and must be eased out.

In late November, with scant public disclosure, the Treasury Department started the Foreclosure Alternatives Program, through which it will encourage arrangements that result in distressed borrowers surrendering their homes. The program will pay incentives to mortgage companies that allow homeowners to sell properties for less than they owe on their mortgages — short sales, in real estate parlance. The government will also pay incentives to mortgage companies that allow delinquent borrowers to hand over their deeds in lieu of foreclosing.

Ms. Reilly, the Treasury spokeswoman, said the foreclosure alternatives program did not represent a new policy. “We have said from the start that modifications will not be the solution for all homeowners and will not solve the housing crisis alone,” Ms. Reilly said by e-mail. “This has always been a multi-pronged effort.”

Whatever the merits of its plans, the administration has clearly failed to reverse the foreclosure crisis.

[Hubbs]

Whatever the merits of its plans, the administration has clearly failed to reverse the foreclosure crisis.

I believe roughly 30,000 mortgages have been successfully altered in a permanent fashion.

Give it another thirty years, and this plan might just get somewhere.

[Larry]

What humors me so, is that people will bring up bush, yet Obama has out spent bush in a matter of months

untrue

for results that aren't working

A year ago, we were weeks, maybe days away from the total collapse of the world's economy.

Now we aren't.

Looks like "Mission Accomplished", to me.

Whatever the merits of its plans, the administration has clearly failed to reverse the foreclosure crisis.

See my above response.

The bailouts were successful in accomplishing their mission: They stopped the stampede/avalanche.

[twa]

The bailouts were successful in accomplishing their mission: They stopped the stampede/avalanche.

They stopped the avalanche with our transport?

What is it with people wanting to stop natural progression?

Hope you enjoy the long walk out of the wilderness

[Larry]

They stopped the avalanche with our transport?

Are you channeling NavyDave? What's with the responses where I can't figure out WTF you're saying?

What is it with people wanting to stop natural progression?

Show me somebody who's actually willing to make that "we should have allowed the entire world's economy to collapse" argument . . .

And I'll show you someone who's so partisan that he's actually upset that we aren't in a Great Depression right now, because they want to Blame Obama for not preventing it.

[twa]

Are you channeling NavyDave? What's with the responses where I can't figure out WTF you're saying?

Our future has been hocked in a vain attempt by both parties to prop up failing models,while you blindly lash out about politics.

And you don't even see it,but it will get a lot clearer in time.

[Larry]

Our future has been hocked in a vain attempt by both parties to prop up failing models,while you blindly lash out about politics.

And you don't even see it,but it will get a lot clearer in time.

Your definition of "failing models" is "the ability to borrow money"?

How long have you had this hatred for capitalism?

[Baculus]

I've resigned that by the time Obama runs for re-election China will own the USA. He's printing money quicker than Milton bradley is for it's monopoly games.

What humors me so, is that people will bring up bush, yet Obama has out spent bush in a matter of months for results that aren't working and he plans on doing more of the same. Which I do believe is the definition of insanity isn't it?

Totally untrue. Bush spent over five TRILLION dollars during his term. Here are several examples of this:

1. Over a trillion spent during the campaigns in Afghanistan and Iraq.

2. $1.2 trillion Bush tax "cut."

3. Over a trillion for the Medicare drug benefit bill.

Why do you think the national debt doubled during Bush's terms in office? It is 100% totally false that " Obama has out spent bush in a matter of months." This is a totally dishonest right-wing meme that I have seen repeated time and time again.

In comparison, the largest expenditure so far, during Obama's term, has been the spending stimulus, which was between $850 to $900 billion. And the health care bill is estimated at $800 to $900 billion over ten years. I would challenge anyone to demonstrate how Obama has "outspent Bush" thus far.

[twa]

Your definition of "failing models" is "the ability to borrow money"?

How long have you had this hatred for capitalism?

Capitalism is allowing things to FAIL as well as prosper on their own merits.

It not I that apparently hates capitalism.

Propping up the overpriced housing market,maintaining foolish lending policies and enabling even more Wall Street credit swaps... along with the automotive crap are failing models.

[Hubbs]

Your definition of "failing models" is "the ability to borrow money"?

How long have you had this hatred for capitalism?

Hmmm.

Exactly what borrowing are you referring to?

[Seabee1973]

untrue

A year ago, we were weeks, maybe days away from the total collapse of the world's economy.

Now we aren't.

Looks like "Mission Accomplished", to me.

See my above response.

The bailouts were successful in accomplishing their mission: They stopped the stampede/avalanche.

They were anything but successful and a few economist are predicting a worse 2010

[Seabee1973]

Totally untrue. Bush spent over five TRILLION dollars during his term. Here are several examples of this:

1. Over a trillion spent during the campaigns in Afghanistan and Iraq.

2. $1.2 trillion Bush tax "cut."

3. Over a trillion for the Medicare drug benefit bill.

Why do you think the national debt doubled during Bush's terms in office? It is 100% totally false that " Obama has out spent bush in a matter of months." This is a totally dishonest right-wing meme that I have seen repeated time and time again.

In comparison, the largest expenditure so far, during Obama's term, has been the spending stimulus, which was between $850 to $900 billion. And the health care bill is estimated at $800 to $900 billion over ten years. I would challenge anyone to demonstrate how Obama has "outspent Bush" thus far.

Every year of Obamas Deficit is projected to be larger than any year that bush was in office

Total spent on Iraq and Afghanistan total is about 900 billion thats through the end of fiscal year 2009

[Baculus]

Every year of Obamas Deficit is projected to be larger than any year that bush was in office

Debt and deficit are not the same thing. Also, I don't know if you are totally correct. Thus far, with the bailout, Bush's total deficit was around $1.2 trillion. Obama, thus far, his deficit is anywhere from $1.4 to $1.8 trillion. High numbers, for sure, but this is including the figures from Bush's terms in office.

This, of course, does not mean we should avoid criticism of federal spending. But we cannot honestly, reasonably talk about this issue if we invent facts to suite our needs.

Total spent on Iraq and Afghanistan total is about 900 billion thats through the end of fiscal year 2009

Which, BTW, is the cost for the proposed health care bill over a decade.

As of late 2008, according to this TIME article, the cost for the WOT was a trillion dollars.

http://www.time.com/time/nation/article/0,8599,1868367,00.html

It's odd, though, how many fiscal "conservatives" ignore this reality. If we shouldn't borrow money for social spending, is it any better to borrow money for new military adventures?

I would MUCH rather see a trillion dollars spent on THIS country than overseas. I would rather see fellow citizens helped than to see the money go into the coffers of the military-industrial-Congressional complex.

But hey, I am "communist" and "unpatriotic" like that.

[ACW]

Can we agree that both parties suck?

[Larry]

They were anything but successful and a few economist are predicting a worse 2010

I repeat: One year ago, we were days or weeks away from the total collapse of the world's economy.

Now we're complaining because we don't have 24 hour sunshine. (Well, one political party is.)

And you want to claim that "2010 will be worse"? Worse than what? Worse than a year ago?

[Baculus]

Can we agree that both parties suck?

I will say this: Politicians who don't make an earnest effort to serve their electorate suck.

How's that for sitting the fence? :-)

[twa]

And you want to claim that "2010 will be worse"? Worse than what? Worse than a year ago?

Could well be....but you can console yourself with the knowledge the next decade is gonna suck either way now

[Larry]

Every year of Obamas Deficit is projected to be larger than any year that bush was in office

1) Untrue. What the right-wing spin machine is calling "the first year of Obama's deficit" was arrived at by taking all of the checks that Bush wrote in his final months in office, and claiming that they're Obama's fault, because well, the checks hadn't fully cleared when he took office.

2) Irrelevant. The claim was "Obama has out spent bush in a matter of months". Not "The deficit is projected to increase".

Total spent on Iraq and Afghanistan total is about 900 billion thats through the end of fiscal year 2009

He says a Trillion, and your response is "well, officially, it's 900 Billion"?

And his point was to list three major Bush programs, each of which is larger than the total that people are trying to direct mock outrage at Obama over?

Did you even notice that your "corrected" number is still bigger, all by itself, than what Obama has spent?

[Hubbs]

Still wondering about that borrowing, Larry.

[McD5]

http://www.extremeskins.com/showthread.php?t=291021

We have already spent and wasted more than 50% of what was required for the biggest economic boom in decades.

So stupid. By the time it is done, we will have spent much more than what was necessary, with none of it getting into the hands of the american household.

Oh, and we haven't seen hyper-inflation.