Bush: Takeover of housing giants 'critical'

Hatuey · 09-07-08, 06:41 PM

Bush: Takeover of housing giants 'critical' - Yahoo! News

Quote:

WASHINGTON - President Bush said Sunday that the historic federal government takeover of mortgage giants Fannie Mae and Freddie Mac is needed to keep them from failing, a risk he called "unacceptable" for an economy battered by housing and credit crises.
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"Allowing the companies to fail or further deteriorate would damage our home mortgage market, and could weaken other credit markets that are unrelated directly to housing," Bush said in a statement released Sunday afternoon. "Americans should be confident that the actions taken today will strengthen our ability to weather the housing correction and are critical to returning the economy to stronger sustained growth."

The Bush administration announced Sunday it was taking control of the two institutions to avert the potential for major financial turmoil.

The companies, which together own or guarantee about $5 trillion in home loans, about half the nation's total, have lost $14 billion in the last year and are likely to pile up billions more in losses until the housing market begins to recover.

Both companies were placed into a government conservatorship that will be run by the Federal Housing Finance Agency, the new agency created by Congress this summer to regulate Fannie and Freddie. The executives and board of directors of both institutions are being replaced.

Whatever happened to the economy taking care of itself? Oh behold the laissez faire conservatives put into office by laissez faire conservatives who believed he'd be the next Reagan. I wonder what kind of support this will get from the Republicans in congress.

tlmorg02 · 09-07-08, 07:07 PM

It has so far been split among Republicans. In my state of Kentucky, Mitch McConnell has expressed intentions to go with the President, and Bunning against. I have also heard many other Republicans speaking out against government bail-outs.

The problem is that laissez faire economics does not work without massive casualties, and in a market already mired by corrupt lending and a weak dollar, government bail-outs are necessary to prevent a slide into a depression.

Frolicking Dinosaurs · 09-07-08, 07:20 PM

I knew this was coming, but frankly I figured it wouldn't happen until after the election, but before GWB left office. Guess things just got too bad for him to wait. This is sad time for the American economy. I hope we don't have another full-blown depression.

Sly · 09-07-08, 07:25 PM

Time to go hiking!

jujuman13 · 09-07-08, 07:26 PM

The US a Socialist Nation.
The mind boggles.

Frolicking Dinosaurs · 09-07-08, 07:30 PM

Quote:

Originally Posted by Sly

Time to go hiking!

When do we leave

?

obvious Child · 09-07-08, 10:33 PM

Quote:

Originally Posted by jujuman13

The US a Socialist Nation.
The mind boggles.

What is truly amazing is that some of the largest socialism has occurred under Republicans.

But we do need some level of socialism. Police, Schools, Firefighters, the Military. What we don't need is socialism that socializes risk and privatizes profit.