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$210 million in bonuses for Fannie/Freddie

As Baron von Ottomatic previously noted, Fannie Mae and Freddie Mac -- the poorly managed government-backed mortgage giants whose collapse largely precipitated the current economic crisis and triggered AIG's credit default swap meltdown -- will be paying out approximately $210 million in retention bonuses to key employees. As you may recall, AIG's inexcusable, unconscionable, immoral, outrageous, "they-deserve-a-90%-tax" retention bonus payments totaled $165 million.

Mortgage finance giants Fannie Mae and Freddie Mac plan to pay more than $210 million in bonuses through next year to give workers the incentive to stay in their jobs at the government-controlled companies.


The companies' federal regulator, James Lockhart of the Federal Housing Finance Agency, defended the bonuses in a March 27 letter to Grassley, noting that the collapse of the company's stock prices "destroyed years of savings for many" workers. The companies' stocks now trade below $1, down from more than $60 in fall 2007.

More than 70 percent of new loans in recent months have been backed by Fannie and Freddie. They own or guarantee almost 31 million mortgages worth about $5.5 trillion, more than half of all U.S home loans.

Keeping the companies "operating at full speed was best for the housing markets and best for the economy," Lockhart wrote. "That would only be possible if we retained the Fannie and Freddie teams."

No sh*t. Any of this sound vaguely familiar?

No word yet on whether the Obama Campaign White House has ordered its minions at Organizing For America or ACORN to begin sharpening their pitchforks ...


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Comments (3)

Frank and Dodd need to be f... (Below threshold)

Frank and Dodd need to be frogmarched down to the federal pen.

This was our government's r... (Below threshold)

This was our government's response regarding AIG bonus:

"The administration official said the Treasury Department did its own legal analysis and concluded that those contracts could not be broken. The official noted that even a provision recently pushed through Congress by Senator Christopher J. Dodd, a Connecticut Democrat, had an exemption for such bonus agreements already in place"

So under contractual laws the Administration cannot stop AIG from giving out bonuses. Fine, President Obama, then have FBI arrest FDIC regulators who broke "contractual laws:"

"F.D.I.C.'s October agreement with JPMorgan Chase and Washington Mutual allows Chase to pick and choose which of the city's 148 Washington Mutual branches it will keep. Chase will then turn over the rejects to the F.D.I.C. But here's the kicker: According to sources, the F.D.I.C. [CAN THEN SIMPLY TERMINATE THE LEASES OF THOSE REJECTED BRANCHES, ALL CONTRACTUAL OBLIGATIONS VOIDED]...

-I am Lanlord for on of the WAMU Location I don't know who to talk to about this Lease or how to pay my Mortgage.
-I believe we spoke with each other. WaMu moved out as of 2/10/,leaving me with an empty building and half a million loan with Chase-WaMu. FDIC legalized the cherry pick by Chase without obligations.Jamie Dimon is really a very smart banker and good bzman,but at the price of all WaMu contractors, landlords,shareholders,etc.
-I got the same situtation. They stopped rent payment. I can not pay the mortgage and will lose the property."

Please do it as soon as possible before Sheila Bair gets the chance to spend $500 billion of our hard earned tax dollar on Geithner's legacy (toxic) asset program. The Depositor Protection Act of 2009, introduced by Chris Dodd and backed by Barney Frank, has been UNETHICALLY AND SNEAKILY inserted into the Credit Card Accountability, Responsibility and Disclosure Act)

FBI can add extortion and blackmailing to the list. Sheila Bair threatened Wachovia and there is a SWORN AFFIDAVIT to prove it:

In October, 2008, WSJ reported this "sworn affidavit filed this weekend in federal court by Wachovia Corp. Chief Executive Robert K. Steel... "Wachovia was under tremendous pressure from Citi and the regulators to conclude a transaction with Citigroup with definitive agreements by the following Monday, October 6, 2008″... The Company's advisors and I told the board that we believed that unless a definitive merger agreement was signed with either Citigroup or Wells Fargo by the end of the day Friday, October 3, that the FDIC was prepared to place Wachovia's banking subsidiaries into receivership," Mr. Steel said in the affidavit."

And to make things more convenient for FBI, arrest Geithner too.

"The Federal government committed extortion... His bank is worth in excess of $250 billion, has no bad debt, no credit default swaps, no liquidity problems, and no subprime loans... The FDIC -- with Treasury backing -- threatened to conduct public audits of his bank unless his board created and issued a class of stock for the Feds to buy"

President Obama, this time please nominate intelligent and fair regulators. American taxpayers would really appreciate it.


Given what 'the team' did a... (Below threshold)

Given what 'the team' did at Fannie and Freddie, do we really want them around anymore?






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Section Editor: Maggie Whitton

Editors: Jay Tea, Lorie Byrd, Kim Priestap, DJ Drummond, Michael Laprarie, Baron Von Ottomatic, Shawn Mallow, Rick, Dan Karipides, Michael Avitablile, Charlie Quidnunc, Steve Schippert

Emeritus: Paul, Mary Katherine Ham, Jim Addison, Alexander K. McClure, Cassy Fiano, Bill Jempty, John Stansbury, Rob Port

In Memorium: HughS

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