Jul 11 2008
A little update on Fannie Mae… Ain’t pretty, won’t get Better.
As we warned long ago, these institutions would be in trouble — you cannot defy economic gravity indefinitely. Of course, helicopter Ben Bernanke is left with no choice but to bail out his Wall Street buddies, lest we forget the Fed is privately owned by Wall Street’s biggest interests. That spells inflation, never mind all the tough talk. Raising rates and fighting inflation will only hasten the collapse of such over-obligated (implied insolvent) institutions holding lots of asset backed investments whose assets are plummeting in value.
I said this about six months ago… Ben will need to use a C-130 when it’s all said and done. So stop calling him helicopter Ben and give him his due C-130 Ben. I can hear the massive engines of the C-130 firing up now to fly to the rescue of Fannie and Freddie. The back end of it is opening and here comes the Federal Reserve Note…losing value as it falls…Oh no another C-130 for Lehman..Wachovia…the question is will Ben have enough C-130’s or will they be needed in Iran???