walkitout (walkitout) wrote,
walkitout
walkitout

fannie, freddie, $75 billion in new capital, wuh hunh?

Okay, I don't fully get this, but here's what I _think_ is going on:

Over the course of the boom, a lot of stuff happened financially that wasn't on the balance sheet. There are some Issues associated with some particular forms of this. Maybe there's going to be a rule change and some formerly off balance sheet stuff is about to become on balance sheet. If that happens, and those are Negatives, then the affected agencies might have to raise more capital (positives) to offset those. I don't get what was off balance sheet (and I really feel like I _understood_ the options scandal back in the day; it was so simple by comparison). I don't get the discussion about whether this rule change (should it occur) will affect the agencies or not. Here, _you_ read it and explain it to me:

http://www.housingwire.com/2008/07/07/fannie-freddie-socked-by-investor-paranoia/

I did find the second half of that article quite hilarious, particularly the bit about how they're having trouble fulfilling the requirement to hire a CEO, seeing as how there are so many vacant CEO slots in financial organizations going begging right now. Now _that_ is funny.

I'm a mean, vicious, cruel person, apparently, to laugh at that.
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