I just do not have the financial background to completely understand the incestuous nature of the different government agencies and their connection to each other and Wall Street, nor do I have the time to educate myself on the various workings of saleable tax credits, but I do know that after reading the following article, I am 100% sure that turning any portion of healthcare over to this government would be SUICIDE.
“Fannie Mae lost $37.9 billion in the first six months of 2009.”
Keep calling and emailing your non-reps. and remind them of Fannie and Freddie! Then, if you can, make sure you are on the Capitol Steps on Thursday, November 5th at noon to meet Michelle Bachmann and look your non-reps. in the eye while you tell them that what they are doing is un-Constitutional, borders on traitorous behavior, and will, at the very least, get them dethroned and derailed from the piggie trough.
From the Wall Street Journal:
Goldman Looks to Buy Fannie Tax Credits
Treasury Lurks as Spoiler as Political Climate Favors Main Street’s Benefit Over Wall Street’s
By DAMIAN PALETTA
Goldman Sachs Group Inc. is in talks to buy millions of dollars of tax credits from government-controlled mortgage giant Fannie Mae, but the potential deal is running into opposition from the U.S. Treasury, which could block the deal.
A sale would bring some needed financial respite to Fannie Mae. But the administration is leery about approving a deal that would help Goldman reduce its tax bill, given the animus held by many lawmakers toward big Wall Street firms in general and Goldman in particular.
The Obama administration is looking at the deal with a critical eye and could block it. Goldman, meanwhile, is hopeful it could win approval this week.
“Treasury is reviewing and will not let it proceed unless it is clearly in the taxpayers’ interest,” spokesman Andrew Williams said.
Fannie Mae and its regulator, the Federal Housing Finance Agency, declined to comment.
“Fannie Mae is owned and controlled by the federal government,” said Goldman Sachs spokesman Michael DuVally, who wouldn’t confirm the company was in talks with Fannie about the credits. “The only basis on which approval for any transaction would be given would be if it was clearly in the taxpayers’ best interest.”
Precise details of the deal couldn’t be learned. Some on Wall Street think Goldman could buy $1 billion of the tax credits, which would allow the bank to offset a portion of its profit. It is unclear how much of a discount Goldman is offering to pay. One person familiar with the potential transaction said Goldman could line up other investors for the deal as well.
Nearly every major business decision at Fannie Mae and Freddie Mac is vetted or directed by the government. Officials at both firms have complained about their contradictory missions — they are at once private companies and tools of public policy.
The Goldman talks are emblematic of these conflicts: A deal that could help Fannie Mae might also be politically unpalatable.
The Treasury Department has purchased $45.9 billion in preferred stock in Fannie Mae since it took over the company last year to pump money into the firm, giving taxpayers a substantial stake in the firm. (emphasis mine.)
The tax credits are an incentive in federal law to spur investments in low-income housing. The law allows investors to receive tax credits for financing qualified housing developments. These credits tend to be drawn out over periods such as 10 years, and are attractive to companies that know they will be profitable during that span.
Fannie Mae, for its part, would be able to unload credits that are weighing on its balance sheet and forcing it to take losses. Selling them would bring earnings into the firm that might offset the amount of money Fannie Mae has to borrow from the Treasury Department. It could also help free up Fannie Mae’s balance sheet so the company can finance more housing loans.
The Federal Reserve waived normal rules to allow Goldman and Morgan Stanley to quickly become bank holding companies last year, protecting them from some of the financial-market trauma that befell Bear Stearns and Lehman Brothers. The government injected $10 billion into Goldman through the Troubled Asset Relief Program. The bank was also helped by the bailout of American International Group Inc., through contracts Goldman had with the giant insurer.
The Treasury has invested a combined $96 billion in Fannie Mae and Freddie Mac since the companies were taken over in September 2008, and it is unclear when either company might be able to repay any of the money. Fannie Mae lost $37.9 billion in the first six months of 2009.
It is the day after the Democrats in the House passed the $819B, (really $1.2 Trillion), stimulus/spending package with all of Nancy’s pet projects getting their share of our pie, and what do I wake up to? The DOW has given back half of it’s gains from yesterday (so far), and two articles that are surely going to make y’all feel warm and fuzzy today:
Hill Republican: Stimulus Aids Illegal Immigrants: (Your tax dollars at work!)
WASHINGTON (AP) – The $800 billion-plus economic stimulus measure making its way through Congress could steer government checks to illegal immigrants, a top Republican congressional official asserted Thursday.The legislation, which would send tax credits of $500 per worker and $1,000 per couple, expressly disqualifies nonresident aliens, but it would allow people who don’t have Social Security numbers to be eligible for the checks.
Undocumented immigrants who are not eligible for a Social Security number can file tax returns with an alternative number. A House-passed version of the economic recovery bill and one making its way through the Senate would allow anyone with such a number, called an individual taxpayer identification number, to qualify for the tax credits.
A revolt among GOP conservatives to similar provisions of a 2008 economic stimulus bill, which sent rebate checks to most wage earners, forced Democratic congressional leaders to add stricter eligibility requirements. That legislation, enacted in February 2008, required that people have valid Social Security numbers in order to get checks.
And an article that is probably more important considering everything that we have been learning about The Fed, The Treasury, Ben Bernanke, Hank Paulson, Timothy Geithner and the NY Bank cabal that is ruining our country:
New Bank Bailout Could Cost $2 Trillion (What? I thought the first $700B was to bailout the banks and buy up the bad assets according to Paulson. Exactly how long are we going to let them lie to us?)
WASHINGTON — Government officials seeking to revamp the U.S. financial bailout have discussed spending another $1 trillion to $2 trillion to help restore banks to health, according to people familiar with the matter.
President Barack Obama’s new administration is wrestling with how to stem the continuing loss of confidence in the financial system, as it divides up the remaining $350 billion from the $700 billion Troubled Asset Relief Program launched last fall. The potential size of rescue efforts being discussed suggests the administration may need to ask Congress for more funds. Some of the remaining $350 billion of TARP funds has already been earmarked for other efforts, including aid to auto makers and to homeowners facing foreclosure.
The administration, which could announce its plans within days, hasn’t yet made a determination on the final shape of its new proposal, and the exact details could change. Among the issues officials are wrestling with: How to fix damaged financial institutions without ending up owning them.
The aim is to encourage banks to begin lending again and investors to put private capital back into financial institutions. The administration is expected to take a series of steps, including relieving banks of bad loans and distressed securities. The so-called “bad bank” that would buy these assets could be seeded with $100 billion to $200 billion from the TARP funds, with the rest of the money — as much as $1 trillion to $2 trillion — raised by selling government-backed debt or borrowing from the Federal Reserve. (…and what is the interest going to be on $2T when $887B has $347Billion in interest? We should probably be talking about 5 future generations in debt to the Fed instead of just three.)
A Treasury spokeswoman said that “while lots of options are on the table, there are no final decisions” on what she described as a “comprehensive plan.” She added: “The president has made it clear that he’ll do whatever it takes to stabilize our financial system so that we can get credit flowing again to families and businesses.” (8 Trillion has gone into saving the banks and insurance companies so far with no effect; what is another $2 Trillion going to do?)
Treasury Secretary Timothy Geithner said Wednesday that he wants to avoid nationalizing banks if possible. “We’d like to do our best to preserve that system,” Mr. Geithner said. But given the weakened state of the banking industry, with bank share prices low and their capital needs high, economists say the government probably can’t avoid owning at least some banks for a temporary period. (I suspect Geithner is lying, just like Paulson and Bernanke did.)
But buying common shares raises the likelihood that weaker banks will become largely government-owned. Bank share prices are so low that any sizable government investment in a bank would give the U.S. effective control of it.
The best approach is to have banks “under pretty heavy government control as briefly as possible — basically long enough to take off the bad assets and recapitalize — and sell the back to full private control as quickly as possible,” said Adam Posen, deputy director of the Peterson Institute for International Economics in Washington. (“Sell the bank to full private control as quickly as possible; does anybody really think that is going to happen?)
I am going to get into so much trouble for saying this out loud, but I am going to say it while I still can. So the question would be, when are Americans going to start marching peaceably in the streets requiring the resignation and prosecution of all these liars and thieves?
(P.S. I would like to extend a warm welcome to the Microsoft, Yahoo, Apple, IBM, and Google corporations for their patronage. I would also like to thank NASA for their return visit. If you want to know what NASA is actually looking at, email me.)