The Obama Administration is under fire this week over their decision to remove the caps that limited the amount of available capital to Fannie Mae and Freddie Mac to $200 billion each. The Administration is being skewered for their sneaky timing, announcing this move quietly on Christmas Eve when consumers were distracted and federal offices were closed for the remainder of the week making contact for comment impossible.
From the WSJ, “unlimited access to bailout funds through 2012 was ‘necessary for preserving the continued strength and stability of the mortgage market,’ the Treasury said.”
Okay, that sounds great, but it’s all too convenient that this announcement came immediately before Fannie & Freddie disclosed their executive pay packages which include millions of dollars in bonuses and why wouldn’t it? Give a crackhead a blank check and see how long it takes him/her to be the proud new owner of all of the crack in a five mile radius. Give your teen daughter a blank check and tell her she can have anything she wants because she needs it and see if you don’t hear tires peeling out as she skyrockets to the mall.
The argument with any golden package given to executives is essentially that you get what you pay for, meaning large corporations (government or otherwise) must compensate qualified and talented leadership.
Okay, BUT unemployment is at a heartbreaking 10% and Texas Representative Jeb Hensarling said, “to be handing out $6 million bonuses to essentially federal employees is unconscionable,” and further criticized the Obama Administration for approving the compensation without settling on a plan to remove taxpayer supports- “to be doing that with no plan in place is just unconscionable.”
What do you think- is the timing to remove the cap too conveniently timed with disclosure of executive pay giving millions to each executive OR was the cap removal crucial for keeping Freddie and Fannie in the position our economy needs them to be? What do you think about this?
Ken Montville
December 29, 2009 at 2:39 pm
This is so over-the-top that it’s hard to catch my breath.
However, what is even more annoying is that when CNBC ran with this story they had *no one* from the NAR. They had the COO of Zillow on as a guest expert to say that, while this may sound bad, it’s really what the housing market needs right now to continue to prop it up.
Zillow! The official voice for the housing market. I can’t tell what is more astounding – the bonuses or the fact that Spencer Rascoff has ousted Vicki Golder from her place in the sun.
Will someone please tell the NAR to wake up!
Portland Condo Auctions
December 29, 2009 at 4:40 pm
Why? Why? This doesnt make any sense. This is moving backwards away from progress.
-Tyler
JR of Sun City Real Estate
December 30, 2009 at 8:50 am
This is really not a good sign. I hope that NAR will focus more in solving the real issue.
Jonathan Brewer, Principal Broker Main Street Realty
January 3, 2010 at 3:40 pm
Oh brother!! Bonuses bonuses bonuses. All the folks responsible for screwing things up get millions of dollars while Real Estate Businesses such as mine struggle to survive from banking bull!! Perhaps the big wigs need to all be wiped out and some fresh faces put in their place. I would love to tell all the stupidity stories about my dealings with financial entities. That has to be the dumbest run sector (financial) in our nation. However big corporations are almost as bad. No wonder we are gettting stomped globally. We are losing a long term financial war.
Someone should consider using resources such as myself (who can provide resources) to show what the “real” world is experiencing and it’s needs. I mean….look how smart some of our legislators are. Someone came up with legislation which required people to pay more principal on their credit card debt while the credit card companies gouge consumers with high interest. Cashflow is the problem there and the idiots just made people’s cashflow worse!! Banks are causing their own foreclosures in some cases in a variety of ways. I could go on forever but I’ve written too much already. I’m thoroughly disgusted at the problem solving abilities of our present day leadership in all the important areas. Bah humbug. The rich get richer and the poor get poorer. Shouldn’t have bailed any of them out and let the market correct itself by eliminating bad business. Innovation would have taken over.
As Americans, we have the ability to become very innovative in times of need…..or at least I thought we were able. Instead we just bail out the bad guys. It’s so much easier. Crazy and just lazy.
c. mazzotta
January 4, 2010 at 8:39 am
Somehow, a majority of Americans actually voted for Obama. I am disgusted with this– yet not surprised. This IS exactly what America voted for. The photo in this article clearly conveys the ideology of our current liberal, democratic leadership.
Folks, that is MY money and YOUR money being flushed down the toilet. Wake up America! Cast a wise vote in 2012!
Janie Coffey
January 4, 2010 at 9:15 am
C – I did cast my vote wisely in 2008 and it’s not changing now or in 2012 and I consider myself fully awake.
Karen Hilgers
January 6, 2010 at 8:07 am
Ken Montville has it right. This whole thing is going the wrong way. It is no surprise since Chicago politics has taken over the nation; I cannot believe people actually voted for this madness…….I am expecting to eventually have to close my office since there really is no friend in government for small business: The credit card companies crazy ‘solutions’ mentioned by Ken and required health care coverage for part time employees will definately play important parts in closing many doors.
Wondering if the presidents money advisors are ones that received the bonuses from the fed insured loan programs?