Fannie Mae Lets BofA Off The Hook

by Colin Barr

"This looks to me like a gift from Tim Geithner," said Chris Whalen of Institutional Risk Analytics. "There's politics all over this."

But how sharp is Freddie if all it can do is squeeze a $1.28 billion payment out of a giant customer in exchange for relinquishing fraud claims on $117 billion worth of outstanding loans? The very best its million-dollar executives can do is claw back a penny on each bubbly subprime dollar?

That seems pretty weak even given that this is Congress' favorite subsidy dispenser we're talking about.

"How Freddie can justify this decision to settle 'all outstanding and potential' claims before any of the private-label putback lawsuits have been resolved is beyond comprehension," says Rebel Cole, a real estate and finance professor at DePaul University in Chicago. "This smells to high heaven and they should be called out."

(These are just excerpts. Here's the full story.)

http://finance.fortune.cnn.com/2011/01/03/is-fannie-bailing-out-the-banks/

Bottom line: BofA walks, money talks, taxpayers screwed again.

Best quote in the article

And it looks like it has been paid.

WHAT?!

...i don't even know what to say.

This is the next bailout, hidden on the back pages. Fannie and Freddie (which are now government controlled) will simply allow ALL the major banks to walk away from the debts they owe the American people to the tune of hundreds of billions of dollars. Their stocks will soar. Foreclosures will continue, and the wealth will be deposited right back into the hands of the oligarchs. Leaving the rest of us broke, and a monumental debt we and our children will never be able to pay back.

Sung to the tune of "There's no business like show business."

Of course, when the Biggest Fish in the pond of wrong doing OWN the government, this is exactly what a person can expect!

Who put Tim Geithner in position to sign off on this? He-whose-name-dare-not-be-criticized!

the day he appointed Mr. Geithner. A rich man who apparently doesn't like to pay his taxes. What else could we expect from him?

but it does seem apt.

the day Paulson walked in with one page and demanded congress fork over the dough.