Ever hear the name Edward DeMarco? He’s the acting director of Federal Housing Finance Agency.
Despite pressure, he refuses to write down the principal on loans held by Federal agencies like Freddie and Fannie or the FHA.
The “just make the problem go away” gang is the usual suspects, Richard Durbin and Barney Frank leading the pack. What would that do to the US debt problem? Writing off billions in loan principals. It will be $124 billion in losses at Freddie and Fannie by 2014 without the write-downs. Once again, it would be the government picking winners and losers. If you didn’t like Cash for Clunkers, how would you feel about this? If you want to bring discipline back to the housing market, what does this do? It says, let’s start a new housing bubble, there is no price to pay for doing the wrong thing, all over again.
Meanwhile, Obama is silent on the bonus payments to the executives of Freddie and Fannie for running a losing business? The man who said in 2008, “we will take the wind out of golden parachutes”, can’t take the wind out of businesses run by the government. Remember how he sent protesters to the houses of AIG executives? What about the Occupiers? Why aren’t they Occuying the White House?
Thank God for men like DeMarco, who do the right thing. They are trying to boot him, and probably will one day. Watch for that Friday announcement, buried on page 20 in a short column in your newspaper, where Obama has named a new permanent head of the FHFA.
Soon afterward, you will hear a big campaign pledge to write down the principals on the mortgages held by Freddie and Fannie.
