Heckuva Job, Bush

Enron should have spelled the end of corporate fraud. Sadly, thanks to Bush and his friends, it was just the beginning. Now Fannie Mae and Freddie Mac are in big trouble and guess who is going to be expected to bail them out? One analyst puts it simply:

"Together both firms have less than 90 billion US dollars in capital reserves to ensure losses on more than five trillion US dollars in mortgage debt," he said.

"Could anyone reasonably believe that a two percent reserve fund can cover all the losses that are likely to be seen? ... Clearly, Fannie and Freddie would have no ability to survive without a government bailout. This means that taxpayers will be on the hook for hundreds of billions of losses, perhaps even more than one trillion."

John Quiggin wonders if nationalization might not be on the agenda?