A look at Fannie's demise

So who's to blame for the credit mess the whole country is now in? Well, it would be too easy to point a finger at any single entity. The New York Times offers an insightful look at one of several easy targets, Fannie Mae. The GSE faced a lot of pressure from politicians and mortgage originators to start buying up really risky stuff. Angelo Mozilo played hardball to get Fannie to buy more high risk debt, and Fannie's Daniel Mudd caved. Lots of politicians wanted Fannie to expand the homeownership pie. Fannie didn't help it's cause one bit with its gross mismanagement. They fudged the books and never raised enough capital, the critics will tell you. And it still galls people that executives walked out of there with Wall Street-like pay. In the end, taxpayers lose. This will be debated for a long time to come. We need a new model for mortgage-oriented GSE. Any ideas?

For more:
- here's the article

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