Video by: madashelldude
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Catherine Austin Fitts talks about it in 2004.
The government sponsored enterprises that form the core of the industry of American home finance have been under attack for several years now. Not only have they enjoyed market pricing for their debt that is based on the assumption that the government stands behind it, but they have also benefited from direct lines of credit from the Treasury. Fannie Mae and Freddie Mac have consequently had a competitive advantage unmatched (and indeed, unmatchable) in the private sector. It is no exaggeration to say that the taxpayer has made possible the meteoric expansion of Fannie and Freddie's balance sheets.
...and hiding the pump.
It is curious therefore that as we reported in November and December 2001, Congress passed legislation allowing Ginnie Mae, the lending arm of the Federal Housing Administration at HUD, to compete for the first time in the commercial market for loans and guarantees with Fannie and Freddie. We are moved to wonder anew about this legislative action in the light of the criminal investigation of Freddie Mac's management launched this summer. Was this anticipated in the autumn of 2001 and was the opening of the commercial market to Ginnie Mae intended to make possible the continued expansion of the national mortgage portfolio behind the shield of the FHA and its refusal to disclose essential financial information? To be blunt, is this just a wheeze to hide fraud?
What is going on? This is a question that every central banker in the world should be asking as he contemplates the level of exposure of his national reserves and his domestic banking system to US agency risk. Is there really matching collateral behind the huge increase in outstanding mortgage debt in America today? It was Hamiltion Securities that provided the sort of place-based information that would have answered this question. We can't prove that the collateral isn't there, at least yet. But what is really scary is that HUD cannot prove that it is.
http://www.financialsense.com/Experts/2004/AustinFitts.html
http://www.scoop.co.nz/stories/HL0310/S00223.htm

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Tags: barnenke bush fannie freddie hud mac mae paulson  financial fraud in the mortgage market 6. See more videos uploaded by madashelldude

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