Bawney should be in jail for what he has done to this country....

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http://finance.yahoo.com/tech-ticker/u.s.-taxpayers-on-the-hook-for-5t-
of-fannie-freddie-debt-%E2%80%A6-no-matter-what-barney-frank-says-
438124.html?tickers=FNM,FRE,XLF,AIG,C,FAZ,JPM

U.S. Taxpayers on the Hook for $5T of Fannie, Freddie Debt … No Matter 
What Barney Frank Says


House Financial Services Chairman Barney Frank caused a bit of an uproar 
Friday when he suggested the U.S. government does not guarantee the 
debts of Fannie Mae and Freddie Mac.

Rep. Frank later recanted and backed a Treasury Department statement 
reassuring investors that, yes, Fannie and Freddie Mae debt is 
guaranteed by the U.S. government. "Going forward," he said in a 
statement, we "will make sure that there are no implicit guarantees, 
hints, suggestions, or winks and nods...we will be explicit about what 
is and is not an obligation of the federal government."

But after years of winks and nods, there's no doubt that Fannie and 
Freddie now enjoy an explicit guarantee, according to most observers. 
The U.S. government placed Fannie Mae and Freddie Mac in conservatorship 
in September 2008: "This means that the U.S. Taxpayer now stands behind 
$5 trillion of GSE debt," according to the Congressional Research 
Service.

The problem is that $5 trillion of so-called agency paper is not treated 
as if it is a debt of Uncle Sam for accounting purposes, says Richard 
Suttmeier, chief market strategist at Niagara International Capital and 
ValueEngine.com.

"Get it on the balance sheet - that's where it belongs," Suttmeier says. 
"Add it to the $14.2 trillion in [federal] debt and let's move on."

Another Time Bomb Ticking But $5 trillion is a lot of money - even by 
government standards -- and moving on may be the problem because of 
ongoing problems in the housing market, Suttmeier says. "There's a 
general concern on Main Street U.S.A. that ‘my neighbors are throwing in 
their keys, there's more for sale signs in my community...do I want to 
buy a new home, risking there's still downside risk to housing?' "

Noting the Case-Shiller 20-City Home Price Index is still 50% above 1999 
levels and mortgage delinquencies are still rising despite the rebound 
in GDP, Suttmeier says "victory is nowhere in sight, particularly when 
the drain we're going to see from Fannie and Freddie is unlimited losses 
between now and the end of 2012 -- on top of the $400 billion that's 
already been allocated."

Coincidentally (or not), the FDIC is allowing U.S. banks until 2012 
before forcing them to fully write-down bad or toxic loans, which is 
"another time bomb ticking," Suttmeier says. "They're hoping
the public 
market comes back into the mortgage arena, which is going to be hard to 
do." 

Unlimited losses from Fannie and Freddie? Keeping zombie banks alive on 
the backs of the taxpayer? Suttmeier's right: There's no accounting for 
that

CMPQwk 1.42-21 9999 
Socialism can work until you run out of everyone elses money .....

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