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July 13, 2008

Love Notes From FannieMae to the Fed, etc.

FannieMae CEO Daniel Mudd is already out with a statement on the U.S. government bailout proposal. I'm particularly fond of the part where Mudd thanks Treasury for bailing him out, but then goes on to insist he doesn't need to be bailed out:

Statement by Daniel H. Mudd, President and CEO

Last update: 6:13 p.m. EDT July 13, 2008
WASHINGTON, July 13, 2008 /PRNewswire-FirstCall via COMTEX/ -- Fannie Mae appreciates today's announcements and the expressions of support for the GSEs as shareholder-owned companies that play a critical role in the U.S. housing finance system. We are grateful for the leadership of Secretary Paulson and Chairman Bernanke. We look forward to working with Treasury, OFHEO and Congress on swift passage of the new legislative proposals, as well as the important initiatives underway to assist homeowners and help restore stability to the housing market. We continue to hold more than adequate capital reserves and maintain access to liquidity from the capital markets. Given the market turmoil, having options to access provisional sources of liquidity if needed will help to strengthen overall confidence in the market. We will continue to do our part to provide liquidity, stability and affordability to the housing market now and in the future.

And while I'm citing releases, there is nothing yet out from Treasury on its site -- Paulson's likely out for dinner with Goldman buddies -- but the Federal Reserve has its statement out too telling Fannie/Freddie to start feeding at the discount window:

For immediate release

The Board of Governors of the Federal Reserve System announced Sunday that it has granted the Federal Reserve Bank of New York the authority to lend to Fannie Mae and Freddie Mac should such lending prove necessary.  Any lending would be at the primary credit rate and collateralized by U.S. government and federal agency securities.  This authorization is intended to supplement the Treasury's existing lending authority and to help ensure the ability of Fannie Mae and Freddie Mac to promote the availability of home mortgage credit during a period of stress in financial markets.

**************************

Just because it's really bugging me, I'll just say this once to get it off my chest: What a fucking travesty that in the world's most supposedly free capital market this toxic government-sponsored duopoly exists. I wish I felt like I would live enough to read history books where people laughed at the absurdity.

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