Quote:
Originally Posted by U376977
What the govt would do is hold them in receivership. We really don't want that to happen. The GSE's have sold MBS (sorry that is industry lingo people might not know) =Mortgage Backed Securites) to the tune of 5.4 Trillion. Say again Trillion. Do we really want the govt. on the hook for associated losses that could occur on a book of assets up to 5.4 Trillion dollars. NOT!
And Fannie and Freddie currently need 75 Billion in captial to cover proposed reserve requirements. They have 1.4 Trillion in offsheet assets.
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It is clearly very serious. and NO I dont want the government to back it.
here is the problem. the government CAUSED it with creating law that REQUIRED lending money to people who really didnt have the ability to PAY the loan back in the first place.
now on the back end, we are stuck.
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