http://online.wsj.com/article/SB123680408920799901.html#articleTabs=comments Freddie Mac, still suffering from the lax mortgage-lending practices of the housing boom, reported a loss of $23.9 billion for the fourth quarter and said it will need a $30.8 billion injection of capital from the U.S. Treasury. The government-backed provider of funding for home mortgages also said it expects its provisions for losses on mortgage defaults to remain high this year and that it is likely to require further funds from the Treasury. Freddie had a loss of $2.45 billion in the year-earlier quarter.
Its interesting how after shareholders got zeroed and it became a non-profit business all of the sudden the losses on the balance sheet appeared very quickly Isnt it interesting how people like the CEO without stock options and running a non-profit tend to be more honest and upfront Now that Dimon is losing big he is out trying to pump his stock and saying mark to market is not so great. This is the guy who made fun of the folks who complained about m-t-m
No kidding, a cautionary tale for what is likely still to come from the banks. I have thought for a while now that there may be unintended consequences to the government agreeing to a giv ethem a blank check in preferreds as it will incentivize the banks to write off as much as possible and take the losses on many toxic assets which means less mortgage mods and more foreclosures and calls. No surprise that Dimon today said that the time for mortgage mods was over.
Someone post the Clinton policy initiative pushing subprime lending. I've been seeing it around again lately... It's all Greenspan's fault... lol