Quote:
Originally Posted by philcski
Sorry, I'm not trying to be mean here, apologies if it came off as such.
The whole financial system would not unravel if the government had allowed to FNM & FRE to continue. Both had plenty of capital and access to more. People and corporations have to learn from their mistakes, and if there's no ramafications to poor decision making where is the incentive to "do the right thing" - which in this case would be to recognize the fallacy of the assumptions in which these loans were underwritten?
So do you believe the next big Wall St sinking ship, whom will remain unnamed but with proper research can be deduced, should also be thrown a life raft as well? I don't.
|
I am going to take a stab at Lehman Brothers. And, no, they should be allowed to fail.
Phil, as far as fannie and freddie goes, dont you think they received the ULTIMATE punishment? In effect both were wiped out in one fell swoop. Management was replaced in both and it is just a matter of time before all the employees become government employees. I know they still have jobs but many will be offered a pittance compared to what they made when the GSE's were private. How was anyone "saved" here? The only thing that might have been saved was the mortgage market.