Wednesday, May 9, 2012

Deja Vu all over again...

Fannie Mae CEO 2007:

"We also set conservative underwriting standards for loans we finance to ensure the homebuyers can afford their loans over the long term. We sought to bring the standards we apply to the prime space to the subprime market with our industry partners primarily to expand our services to underserved families.

September 7th 2008: Fannie Mae is placed into Government Conservatorship. 
From Wiki:
The law enabling expanded regulatory authority over Fannie Mae and Freddie Mac increased the national debt ceiling US$ 800 billion, to a total of US$ 10.7 Trillion in anticipation of the potential need for the Treasury to have the flexibility to support the federal home loan banks. 

So far the Congressional Budget office estimates that $300 Billion of support has been given to the two agencies by tax-payers.

CMHC May 2012:

“CMHC follows prudential regulations as set out by the Office of the Superintendent of Financial Institutions, with CMHC maintaining more than twice the minimum capital required by OSFI,” it said. “As a result, CMHC is well positioned to weather possible severe economic scenarios.”

It pointed out the agency “manages its mortgage loan insurance and securitization guarantee operations using sound business practices that ensure commercial viability without having to rely on the government of Canada for support.”

Are you reassured now?


  1. It is not clear who the audience for the CMHC statement is.

    Is it the politicians, to try and save their empire, well-paying jobs and board positions?

    Is it the public who are getting increasingly anxious about the liability and bubble that the CMHC has blown?

    Or is it the guilty trying to exonerate themselves before the fact. "We haven't done anything" " We were just following orders" Where have we heard that before?

  2. Good for you, Fish.

  3. "JPMorgan's $2B trading loss puts spotlight on risky practices, Volcker rule" - CBS News‎ - 3 hours ago

    Business as usual is the order of the day. If the damages become irreversible, torch the house and let the taxpayers foot the bills.

    p.s. the latest crook that has escaped to Canada with his entire clan, chalked up 1.8 Billion unaccounted for (approx C$240 million). Good news for Cam et al.

  4. G&M's article generated >950 comments:

    Haven't we seen it all already?!
    the wandering ghosts at UBC hospice
    the squatters at a Montreal factory's toilets

    further away, the curry smell

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