Edward DeMarco, acting director of the Federal Housing Finance Agency

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Yesterday the Financial Times reported that Edward DeMarco, acting director of the Federal Housing Finance Agency which oversees Fannie Mae and Freddie Mac, is resisting banking lobbyists' efforts on Capital Hill and in the Obama administration to have nearly a trillion dollars in banking losses paid by taxpayers. Elements in the Obama administration who have crafted a scheme to have banks reduce loan balances on homes in foreclosure or about to go into foreclosure, want these GSAs to take responsibility for mortgage reductions in order to preserve the major banks' investments in second mortgages and lines of credit that the homeowners had taken on. In normal foreclosures and bankruptcy proceedings the banks seconds would be defaulted causing them to lose money. The present plan requires the GSAs (thus the taxpayer) to take the loses.

Niccolo Caldararo's picture
Niccolo Caldararo
Jul. 22, 2011 10:15 am

Currently Chatting

Should public radio program in the public interest?

NPR is supposed to be our national public radio, but they're barely covering climate issues that are in the public's interest.

Only one month ago, a national New York Times/CBS News poll found that half of all Americans think that global warming is already having a serious impact. Sixty percent of those surveyed even said that protecting our environment should be a priority “even at the risk of curbing economic growth.”

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