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Victoria ,
Victoria ,
FYI.
The results of 50+ yrs of US government housing policy?!
Pete
“The United States’ quantitative easing policy did not impact Standard & Poor’s decision to place the sovereign rating on negative outlook, but its conservatorship of Fannie Mae and Freddie Mac certainly did.
One of the pressures on the credit is analysts’ estimate that it could cost the U.S. government up to “3.5% of GDP to appropriately capitalize and relaunch Fannie Mae and Freddie Mac” in addition to the 1% of GDP already invested.
S&P analysts said the government may have to inject as much as $280 billion into the government-sponsored enterprises, which includes $148 billion already spent, to cover losses at the housing finance companies that were put into conservatorship in September 2008.
“By our estimates, that $280 billion could swell to $685 billion if the government capitalizes Fannie and Freddie on a commercial basis,” S&P said.””