“Mr. Raines Returns to Washington….”
Posted by Larry Doyle on December 12, 2008 1:35 PM |
In the midst of the economic turmoil, the Obama transition, the “rescue” of the domestic auto industry, and the Blagojevich fiasco, the biggest story of all in terms of “$$$” is getting limited coverage in the media, but not here at NQ!!
The core of the global economic meltdown is centered on our domestic housing market and the core of that market is centered on Freddie Mac and Fannie Mae.
It is a shame that the Congressional hearing of the four senior executives (Richard Syron and Leland Brendsel of Freddie Mac and Daniel Mudd and Franklin Raines of Fannie Mae) is not front and center on every media outlet in our country.
It is also a shame that the respective heads of the Congressional Banking Committees are not heavily involved in these hearings. Those individuals, Barney Frank and Chris Dodd, along with their colleague, Chuck Schumer should not only be compelled to question these executives, but they themselves should be compelled to be questioned by their colleagues.
Read here as to how “Fannie, Freddie Executives Knew of Risks….” The fact that the executives “generally dodged demands by committee members that they accept blame for those problems” is the height of shamelessness and hypocrisy.
How I wish that we had real statesmen in Washington who had the courage to question these individuals on the following points, which were highlighted here on October 16 in a piece entitled “A Wall St. Insider’s View of Freddie/Fannie.”
- The lobbying power exerted by Freddie and Fannie. Who received how much money???!!!
- The growth of Freddie/Fannie business model via the massively levered internal “hedge fund” portfolios.
- How Senator Richard Baker (R-LA) and the editorial page of the WSJ railed against the business model and escalating risks at Freddie and Fannie starting in the late ’90s.
- How FM Watch, a consortium of Wall St. banks, lobbied unsuccessfully in the early part of this decade against the growth of Freddie/Fannie funded by implicitly guaranteed government debt.
- How independent and extensive research highlighted that the benefit of the Freddie/Fannie model was a whopping 3 to 4 basis points for the American homeowner.
- Why did not one single Democrat vote in committee to support the Baker/McCain legislation to reform Freddie/Fannie in 2003? Feel free to reread that piece if you’d like.
I commend Rep Darrell Issa (R-CA) and Rep Carolyn Maloney (D_NY) for carrying the torch as best they could in the midst of the parrying by the aforementioned shameless execs.
Do we have any other leaders or statesmen who are willing to ask the tough questions and demand answers. The American public and American taxpayers deserve so much better!