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Private sector loans, not Fannie or Freddie, triggered crisis Read more: http://www.mcclatchydc.com/2008/10/12/53802/private-sector-loans-not-fannie.html#ixzz1

by muzz 15y ago

Private sector loans, not Fannie or Freddie, triggered crisis Read more: http://www.mcclatchydc.com/2008/10/12/53802/private-sector-loans-not-fannie.html#ixzz1YSrOwG00 http://www.mcclatchydc.com/2008/10/12/53802/private-sector-l... http://www.mcclatchydc.com/2008/10/12/53802/private-sector-loans-not-fannie.html http://www.mcclatchydc.com/2008/10/12/53802/private-sector-l...

jessedhillon 15y ago
Thank you! It's ironic that on a site like HN, so much of the commentary about home lending is based on rhetoric and dogma instead of fact. I wonder if GP even knows what Fannie or Freddie do.
- gavanwoolery 15y ago
  Read my comment above. Then check your facts, and the "facts" others post before preemptively determining what you think is based on rhetoric and dogma.
lootabooga 15y ago
That's like saying: "it's not the shooter that killed you, it's the hole produced by the bullet". Fannie and Freddie facilitated the risky "private sector loans" big time. In fact, they profited and built their whole scheme on ever riskier private sector loans... So, there...
gavanwoolery 15y ago
Ha, that's a joke - are you aware that during and prior to the crisis, Fannie and Freddie were both PRIVATE companies? They traded on the stock market, as private companies do. The government eventually nationalized them (in 2009 I think) and completely destroyed their value on the stock market (I should know, I owned stock in the two during the crisis - they traded under FRE and FNM before they turned into junk stock). The only respect in which Fannie and Freddie were public (prior to being nationalized) is that they were federally-backed. What happens when you have lenders backed by government dollars? They take in riskier loans and leverage the hell out of their credit line. In reality, it is much more complex than that though - there are many layers on which debt is traded. But the end message is that private companies should never be federally backed! http://en.wikipedia.org/wiki/Fannie_Mae http://en.wikipedia.org/wiki/Fannie_Mae http://en.wikipedia.org/wiki/Freddie_Mac http://en.wikipedia.org/wiki/Freddie_Mac Freddie Mac and Fannie Mae were not the sole catalysts, but they were silos for toxic debt.

by muzz 15y ago

jessedhillon 15y ago

Thank you! It's ironic that on a site like HN, so much of the commentary about home lending is based on rhetoric and dogma instead of fact. I wonder if GP even knows what Fannie or Freddie do.

gavanwoolery 15y ago
Read my comment above. Then check your facts, and the "facts" others post before preemptively determining what you think is based on rhetoric and dogma.

lootabooga 15y ago

That's like saying: "it's not the shooter that killed you, it's the hole produced by the bullet". Fannie and Freddie facilitated the risky "private sector loans" big time. In fact, they profited and built their whole scheme on ever riskier private sector loans... So, there...

gavanwoolery 15y ago

Ha, that's a joke - are you aware that during and prior to the crisis, Fannie and Freddie were both PRIVATE companies? They traded on the stock market, as private companies do. The government eventually nationalized them (in 2009 I think) and completely destroyed their value on the stock market (I should know, I owned stock in the two during the crisis - they traded under FRE and FNM before they turned into junk stock). The only respect in which Fannie and Freddie were public (prior to being nationalized) is that they were federally-backed. What happens when you have lenders backed by government dollars? They take in riskier loans and leverage the hell out of their credit line. In reality, it is much more complex than that though - there are many layers on which debt is traded. But the end message is that private companies should never be federally backed! http://en.wikipedia.org/wiki/Fannie_Mae http://en.wikipedia.org/wiki/Fannie_Mae http://en.wikipedia.org/wiki/Freddie_Mac http://en.wikipedia.org/wiki/Freddie_Mac Freddie Mac and Fannie Mae were not the sole catalysts, but they were silos for toxic debt.