Sunday, September 7, 2008

Fannie and Freddie

The bailout of Fannie and Freddie was announced today. Its not my area of expertise, but like the bailout of Bear Stearns I think its an unfortunate but probably necessary policy response. Its sort of like Churchill's saying about democracy: "Democracy is the worst form of government, except for all those other forms that have been tried from time to time." I expect that many will disagree with the bailout but I doubt few have a sound alternative in mind. (For example, see Jerome a Paris's diary at kos)

I would suggest the following sources for understanding and following new developments:

The Big Picture
Calculated Risk

The Big Picture using a very rough calculation, suggests that taxpayers may end up footing about $150 billion dollars. In current dollars that's about $25 billion more than tax payers shelled out for the S&L debacle that Bush senior presided over. In 1991 dollars, however, this would be about $100 billion. I guess as with the misery index under both Bushes, the apple doesn't fall far from the tree.


donna said...

Obama needs to grab the Fannie/Freddie Palin gaffe and the McCain "Don't know much about the economy" gaffe and get an ad out there stat. AND get the info out there about his plan for small businesses and the correct info on taxes. These ads HAVE to go out, there's too much disinformation out there.

"McCain/Palin -- bad for your pocketbook" or something. Hit them, hard.

lerxst said...


Absolutely with you on've probably heard that Obama now has an ad out countering the maverick crap