They hold most 30 year mortgages. Subprime mortgagages, ARMs etc were securitized. If the problem was Freddie or Fannie not getting paid it would be a differe

They hold most 30 year mortgages. Subprime mortgagages, ARMs etc were securitized. If the problem was Freddie or Fannie not getting paid it would be a different problem. Lehman Bros went bankrupt, as would many other financial institutiosn without a bailout because they held a lot of garbage paper (including subprime mortgages) and were very illiquid. Many European and Asian banks had huge US mortgage exposure. The problem was extreme mispricing of risk and illiquidity.