At the end of last week, the warning came. The Chinese officially warned Hank Paulson et al. that they better get their act together on Fannie and Freddie. The Chinese own a ton of GSE paper and they would be hopping mad to see their investments lose value.
The implicit threat is that the Chinese [...]

Caroline Baum is one of the more insightful financial market pundits around. In her column she takes aim at Fannie and their private reward, public risk corporate setup. Basically, the Fannie-Freddie bailout is a simple case of “heads and management wins, tails and taxpayers lose.”

Two weeks ago, with their stock prices plummeting and [...]

The day is almost over for the market (thank goodness) and it seems that financal service investors are in panic mode again. The market is down over 250 points and some shares in financial services are down over 15%. What gives?
As we may soon find out, non-market based economic solutions, like the infamous SEC [...]

The U.S. House of Representatives has passed the housing bailout bill helping troubled mortgage borrowers, but also giving the U.S. Treasury Department a blank check to support Fannie Mae and Freddie Mac. The New York Times describes it this way:
Representative Barney Frank, Democrat of Massachusetts and a primary author of the legislation, [...]

Senator Jim Bunning (R-KY) blasted Fed Chairman Ben Bernanke, who was giving the semiannual monetary policy report before the Senate Banking, Housing and Urban Affairs Committee today. His comments were the sharpest I heard throughout the hearing. The hearing is expected to be brief in order to make time for a later joint hearing with [...]

This is just a step en route to nationalization. We are seeing a spiral down that will mean the U.S. Government will eventually step in. These organizations will fail without government support and they are too big to fail.
Fannie Mae and Freddie Mac had their bank financial strength and preferred stock ratings cut [...]

From Bloomberg:

Paulson Statement on Freddie Mac, Fannie Mae: Full Text
July 13 (Bloomberg) — Following is the text of a statement issued today by Treasury Secretary Henry Paulson:
Fannie Mae and Freddie Mac play a central role in our housing finance system and must continue to [...]

The Times of London is reporting that Treasury Secretary Paulson is looking to infuse Fannie and Freddie with $15 billion to help alleviate market turmoil. However they cite no sources in doing so.
Moreover, the $75 billion offered by Lehman Brothers which started this crisis is much closer to the amount of capital needed by [...]

For other posts on Fannie and Freddie see ‘GSE ‘ label.
Going forward, Fannie Mae and Freddie Mac are going to be much talked about in the news. Therefore, as a reference, I am providing a list of big Washington Post stories dating back to 2005 below. Fannie, Freddie rise after dive a [...]

Dean Baker has been on record since at least 2002 as predicting both the mortgage bust and the Fannie-Freddie collapse.
“If housing prices fall back in line with the overall rate price level, as they have always done in the past, it will eliminate more than $2 trillion in paper wealth and considerably worsen [...]