Saturday, October 11, 2008
The bailout / rescue mission is changing
In June 2008 there were foreclosures in all home mortgage markets. These include Prime 217,088, Alt-A 118,018, and Subprime 154,955 these numbers are based on information provided by Bank of America, Citibank, First Horizon, HSBC, JPMorgan Chase, National City, USBank, Wachovia, Wells Fargo, Countrywide, IndyMac, Merrill Lynch, Wachovia FSB, and Washington Mutual. Some of these financial institutions are no longer in business. On October 3, 2008 the U.S. Treasury Secretary Henry Paulson said that the administration may use the authority granted in the $700 billion rescue plan to take ownership stakes in financial institutions to stabilize and restore confidence in them. This isn’t this what we were being told to sell us on the idea? The U.S. current has holdings of 79.9% in both Fannie and Freddie. If AIG fails to manage their company properly then the U.S. holds 79.9% of the company. This begs the question, who is next?