More of Your Money for Fannie! – You Have Plenty to Spare Right?
The AP is reporting today that the government-sponsored mortgage giant, Fannie Mae, is in need of a additional 11 billion dollars in tax payer money – or it will go under! After posting a massive 2nd quarter loss of $15.2 billion, they are in desperate need of financial support from our government. – When will this bailout era ever end?
Is it any doubt that President Obama will fund the government sponsored giant? He did in fact receive the most campaign funding of any politician in government (outside of Sen. Dodd) from the Fannie Mae Corporation. (In only 3 short years!) I think it is safe to say the confiscation of taxpayer funds to keep ‘Fannie’ afloat is a given…
An excerpt from the article is below…
Fannie Mae’s new request for $10.7 billion from the Treasury Department will bring the total for Fannie and Freddie to nearly $96 billion. Freddie is expected to report its quarterly results on Friday.
The government has pledged up to $400 billion in aid for the two companies, which play a vital role in the mortgage market by purchasing loans from banks and selling them to investors. They have been under government control since last September, when their near-collapse helped set off the financial crisis.
Together, Washington-based Fannie and McLean, Va.-based Freddie own or guarantee almost 31 million home loans worth about $5.4 trillion. That’s about half of all U.S home mortgages.
With assets of that size, “it’s hard for their problems to be small,” said Karen Shaw Petrou, managing partner at Federal Financial Analytics, a consulting firm that advises financial institutions.
Fannie Mae posted a second-quarter loss of $15.2 billion, or $2.67 per share, including $411 million in dividend payouts. That compares with a loss of $2.6 billion, or $2.54 per share, in the year-ago period.
“We are dependent on the continued support of Treasury in order to continue operating our business,” Fannie Mae said in a Securities and Exchange Commission filing late Thursday.
With these additional funds, Fannie Mae’s bailout will reach nearly 100 billion dollars – Whew!
The sad part is that they are not even profitable yet, and it will take many additional bailouts to fully clear Fannie’s books! (Thanks to the lunatics allowed to run the asylum over at these mortgage giants!)
But if you think this is bad, get ready for the mother of all bailouts that is coming this fall. Rumor has it, that President Obama is contemplating a massive bailout of Fannie and Freddie come the start of September. – (Good, I hate long waits.)
Cheers Thinking Patriots,
Jason
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