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Originally Posted by Tim
Yes, Palin does indeed lack expertise on the economy. As do McCain, Obama and Biden. Obama's statements on trade and the effects of the capital gains tax rate on the economy were of equal stupidity, but of greater import - as he put them forth as part of a policy.
What is also indefensible, however, is your own lack of awareness regarding this topic. Get your facts straight.
This is not an example of a private corporation being bailed out by taxpayers. These companies were an attempt to combine private enterprise with implict government backing: a combination of the market and the state that would allow for risk because the taxpayer would always be there.
It is this combination that has proven to be a disastrous failure.
The takeover by the Fed may be defended because of the extraordinary risks involved in a collapse. However, they have made a great mistake in allowing the weird hybrid structure to remain intact. Eighty percent has been nationalized, but a small portion has been allowed to remain tied to the markets. This was very stupid.
Lobbyists from both parties as well as politicians have disgraced themselves here. For years these two-headed behemouths have been heading for a fall.
They are most certainly not examples of private enterprise run amok. If they had been, they would have dropped dead a long time ago.
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Spare me. I was correct. My facts were straight.
Fannie and Freddy are GSE's that are privately owned and they are not taxpayer funded.
They are but 2 of many institutions who gave out way too many sub-prime ARMs and are now paying the price. Bear Stearns was hit by the same thing and bailed out for the same reasons.
Government sponsored enterprise - Wikipedia, the free encyclopedia
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Some of the GSEs, such as Fannie Mae and Freddie Mac, are privately owned but publicly chartered; others, such as the Federal Home Loan Banks, are owned by the corporations that use their services. Their lenders grant them favorable interest rates, and the buyers of their securities offer them high prices, as the implicit involvement of the Federal government gives them a sense of financial security.
In fact, GSE securities carry no explicit government guarantee
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Bailing out Fannie and Freddie was not an example of cutting bureaucracy as Palin stated. They were bailed out for economic stability and to keep outstanding mortgages intact... it was not bailed out to save taxpayer money.