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U.S. Seizes Mortgage Giants - WSJ.com
U.S. Seizes Mortgage Giants - WSJ.com
In its most dramatic market intervention in years, the U.S. government seized two of the nation's largest financial companies, taking direct responsibility for firms that provide funding for around three-quarters of new home mortgages. Treasury Secretary Henry Paulson announced plans Sunday to take control of troubled mortgage giants Fannie Mae and Freddie Mac and replace the companies' chief executives. The Treasury will acquire $1 billion of preferred shares in each company without providing immediate cash, and has pledged to provide as much as $200 billion to the companies as they cope with heavy losses on mortgage defaults. The Treasury's plan puts the two companies under a conservatorship, giving management control to their regulator, the Federal Housing Finance Agency, or FHFA. With
Posted by: Marlowe 08-Sep-2008 17:24 Source: [A] online.wsj.com Type: Media Category: Elections 2008
U.S. nears rescue plan for Fannie, Freddie - Washington Post- msnbc.com
U.S. nears rescue plan for Fannie, Freddie - Washington Post- msnbc.com
The government has formulated a plan to put troubled mortgage giants Fannie Mae and Freddie Mac under federal control, dismiss their top executives and prop them up financially, federal officials told the two companies yesterday, according to three sources familiar with the conversations. Under the plan, which could prompt one of the most sweeping government interventions in the workings of financial markets in U.S. history, federal officials would place the firms under a conservatorship, a legal status giving the government the option and time to restructure and revive the companies, the sources said. The value of the companies' common stock would be diluted but not wiped out; while the holdings of other securities, including company debt and preferred shares might be protected by the gov
Posted by: boomboom 06-Sep-2008 12:39 Source: [A] msnbc.msn.com Type: Media Category: Economy/ Fiscal Policy
US rescue of Fannie, Freddie poses taxpayer risks - AP, SFGate
President Bush's "ownership society" was never supposed to come to this. With the government takeover of Fannie Mae and Freddie Mac, U.S. taxpayers now essentially own the bulk of the nation's mortgage market. This ownership could even lead to a big increase in the national debt — to $15 trillion, up from just under $10 trillion now — if things don't work out as planned. For a Republican administration that has favored market remedies and less government intervention, and once boasted of an "ownership society" with more individual ownership of private homes, retirement savings accounts and health care policies, the takeover of Fannie and Freddie has been a stark return to a far heavier federal hand on markets.
Posted by: elemming 09-Sep-2008 00:39 Source: [A] sfgate.com Type: Media Category: Economy/ Fiscal Policy