Fannie and Freddie are getting nationalized

[harry123]

According to reports from the NY Times, Freddie and Fannie are probably going to be nationalized. This is a very big deal.

And, honestly, this is pretty upsetting on one level. It will mean trillions more in debt for the US government. And it will certainly mean losses in the hundreds of billions from the existing mortgage portfolio owned by the two.

Are there any other options?

Here are my posts on it. The second one I wrote first -- ironically BEFORE I heard about the government's announcement.

http://www.creditwritedowns.com/2008/07/federal-takeover-of-gses-now-in-works.html

http://www.creditwritedowns.com/2008/07/is-fanne-freddie-debacle-result-of.html

[kenny blankenship]

1. given that "conservatorship" of the GSEs will effectively double the US national debt

it seems the Big Darkness is now upon us. The Fed is all out of bullets and it looks like there is no place safe in the U.S. anymore.

Where outside the US would you send money for an extended vacation?

[Nay]

2. Canada. Right NOW.

[The Backlash Cometh]

3. Gee, where are the voices of deregulation now?

Why don't we just send the bill to Grover Norquist?

[CoffeeCat]

4. I think we're witnessing the part...

...where government is "drown in the bathtub."

We're gasping, and the last breath is imminent.

Sad.

[The Backlash Cometh]

5. It's more like all the rich Republicans took the lifeboats and we're locked in

the boiler room, going down with the U.S.A. Titanic.

[intheflow]

6. Already happened.

In New Orleans.



Now it's just being spread to the rest of the country.

[nadinbrzezinski]

7. the depression is round the corner

and this is an effort to keep the house of cards going until the election

[A HERETIC I AM]

8. Do you actually think each and every Fannie and Freddie loan will default?

I'm also curious if you understand exactly what is meant by a "write down".

What is meant by the term "mark to market" and exactly what are the consequences of such a move?

Do you truly understand these two terms?

BTW, welcome to DU.