Timmy Hopes You Won't See That He Just Gave Fannie and Freddie an Unlimited Bailout for Christmas
You read that headline correctly. (h/t WC Varones)
Tim Geithner and the Treasury decided to give Fannie and Freddie a black Amex without approval from Congress. At least Hank Paulson had the decency to come beg for it:
The Treasury Department said Thursday it removed the $400-billion financial cap on the money it will provide to keep the companies afloat. Already, taxpayers have shelled out $111 billion to the pair, and most analysts hadn't expected the companies to hit the limit.
Treasury Department officials said it now will use a flexible formula to ensure the two agencies can stand behind the billions of dollars in mortgage-backed securities they sell to investors. The formula is to provide the companies with a sufficient cushion based on projected losses over the next three years.
Geithner doesn't care, Santa doesn't come down that motherfucker's chimney.
By making the change before year-end, Treasury sidestepped the need for an OK from a bailout-weary Congress. But the timing of the announcement on a slow news day raised eyebrows.
"The companies are nowhere close to using the $400 billion they had before, so why do this now?" said Bert Ely, a banking consultant in Alexandria, Va. "It's possible we may see some horrendous numbers for the fourth quarter and, thus 2009, and Treasury wants to calm the markets."
Especially after this supreme bitch move on a Friday. Speaking of Fridays, since today is Christmas that means we're finished with Bank Fail Friday for the year. Unless, you know, Sheila gets smart and seizes SunTrust on a Thursday like they did with Bank United. I've heard it's only a matter of days or weeks but what do I know?