Home > economics, General, News, Political, Politics, Pre Pulse Ramblings > Freddie Finances Scarier Than Bad Slasher Flick

Freddie Finances Scarier Than Bad Slasher Flick


Nothing has changed since the financial collapse.  Nothing at all.  The catalyst, the spike in demand for oil caused gas prices to skyrocket to never-before-seen levels.  Those who were approved sub-prime loans had to make a choice:  pay for gas, or pay the mortgage.  They chose the former and mortgages foreclosed across-the-U.S.

And there were quite a lot of sub-prime loans.  Government interference and the Fed directed lines of production toward housing development.  Those who were not credit worthy were awarded sub prime mortgages (at adjustable rates).  Freddie Mac and Fannie Mae used these mortgages as asset securities and sold them all over the world.

Since then, nothing has changed.  Nothing has been done to increase the supply of oil or gas, the event which started the whole thing.  Meaning, that any recovery presupposes an increased demand in supply constricted energy sources.  Furthermore, nothing has been changed with the Fed, which continues to print money and shove them at the banks.  Nor has anything been done to change the practices at FNM/FDM…they continue to issue loans to those who are not credit worthy.

This will happen again, and again, and again….

How about the government get out of the business of energy, housing, currency, and financial markets and let the free market do what it does best?

Story.

FIL “FILVIS” RECHNITZER

  1. May 14, 2010 at 6:39 am

    Good post and it is surprising to consider that nothing has changed.

  2. May 14, 2010 at 8:00 pm

    Agreed, is a very good post. Very succinct but lotsa info. I love how Congress is gonna minimize risk of future bubbles with their fancy new Wallstreet-spanking bills. Yeah. That’ll end well.

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