Decades from now the summer of 2008 will likely be remembered to mark the turning point where legislative blundering took an otherwise serious financial crisis and molested it into an epic financial disaster.
By fully assuming the liabilities of Fannie Mae and Freddie Mac, the two colossal and corrupt (and conduit of corruptness funneling junk Countrywide Financial loans onto the implied balance sheet of the federal government) government sponsored enterprises, the federal government, led by Treasury Secretary Paulson and Federal Reserve Chairman Ben Bernanke, thrust taxpayers into an abyss of insolvency with one mighty shove.
The following chart shows what Fannie Mae terms the count of “Seriously Delinquent” loans as a percentage of all loans on their books.
Notice that despite all the government gimmicks and manipulation the level of delinquency at these two mortgage giants continues to mount.
It’s important to understand that Fannie Mae does NOT segregate foreclosures from delinquent loans when reporting these numbers.
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