Friday, July 11, 2008

Argentina Watch

Don't think it can't happen here because our govenment is all over it. When I saw Fannie Mae and Freddie Mac in the news I knew it had to be bad:
The U.S. government is considering taking over Fannie Mae (FNM.N) and Freddie Mac (FRE.N) if their funding problems worsen, the New York Times said on Friday, causing shares of the mortgage finance companies to plunge.
This would mean the shares would be worth little or nothing, and the losses on home loans they own or guarantee -- half of all U.S. mortgages -- would be paid by taxpayers.
I'm of a mind that these things should die a quick, painful death. Their very existence is an abomination that the economy will constantly worry will do it in. In the I.T. world this would be a giant, critical, single point of failure application which can not fail, but is running on an ENIAC server:
The Bush administration had considered calling for legislation to give an explicit government guarantee on the $5 trillion of debt owned or guaranteed by the companies, the Times said. That was seen as a less attractive option because it would effectively double the size of the national debt.
FIVE TRILLION?!?!? There's very little that isn't more 'attractive' than that.

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