Is Fannie bailing out the banks? |
| CNNMoney - Jan 4, 2011 |
Why yes, say critics of the giant banks. They charge that Monday's rally-stoking mortgage-putback deal between Bank of America (BAC) and Fannie Mae and Freddie Mac is nothing more than a backdoor bailout of the nation's largest lender. It comes courtesy, they say, of an administration struggling to find a fix for the housing market while quaking at the prospect of another housing-fueled banking meltdown.
Monday's arrangement, according to this view, will keep the banks standing -- but leave taxpayers on the hook for an even bigger tab should a weak economic recovery falter. Sound familiar?
Happy New Year indeed
"The administration is trying to weave a path between two bad alternatives," said Edward Pinto, a resident scholar at the American Enterprise Institute. "They want to bail out the big banks without doing apparent damage" to the sagging U.S. budget position.
Read Full Article from CNNMoney
- Posted: 2011-01-04 10:15:13
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