By Franklin Sanders, www.the-moneychanger.com
In the Lunatic Asylum called the United States, here's an example of what passes for sanity. One Senator Kay Hagan, a North Carolina Democrat, has sponsored legislation that would dissolve Fannie Mae & Freddie Mac, the government sponsored entities that cornered the market on making mortgages and added jet fuel to the real estate bubble. If it just stopped there, who would complain? But that would be sound reasoning & sanity, which have no place in America & certainly not in the US Congress. Her bill would also found a new “Federal Mortgage Insurance Corporation” like the Federal Deposit Insurance Corporation, only to insure banks against their losses in mortgages.
The reasoning runs something like this: government entities have been SOOO successful in the mortgage field, that we need another, even bigger one to bail out the banks in case of another mortgage bubble.
Is there not even a single pea-brain in Washington who can see that the CAUSE of bubbles is government meddling in the economy?
Never mind, that's not the real point of this legislation. The real point is the “Garbage Can.” You can count on a natural born fool from Tennessee not to church up & sugar coat what's really going on. It's simple: follow the money. Cui bono? Who benefits? Whose palm is greased?
Remember the Savings & Loan Crisis back in the early 1990s? The government applied the “Garbage Can” solution: create a garbage can where you can dump all the worthless securities, let them ferment & fester a while, & maybe some of 'em will make good. Meanwhile, you've gotten them off the banks' balance sheet & charged up the banks for the next bubble.
What's most incredible is that Bernanke has turned the Fed into the Garbage Can for the mortgage bubble. Think — what's he buying? Mortgage Backed Securities. What was rotting fastest in the mortgage bubble's wake? Mortgage Backed Securities. Hagan's plan to scrap Freddie & Fannie & create a federal mortgage insurer no doubt belongs to a plan to bail the Fed out of all that bad paper, creating a new Garbage Can.
Shucks! I left out the best part: the point of the garbage can is always to dump all the losses where they belong, on the taxpayers' backs.
Finally, for folks who don't even have as much sense as a natural born Tennessee fool, what evidence CLINCHES my conspiracy theory? Who's backing Hagan's plan? Why, the North Carolina banking, credit union, & Realtor associations, as well as the National Assn. of Home Builders. Folks, where that many hogs are gathered, there's bound to be a trough somewhere.
There's more. 5 Republicans & 3 other democrats on the banking committee favor this. “Bipartisan” is virtually a synonym for “the banks want it.”
How long are y'all gonna stand for this?
