Laurie Goodman of Amherst Securities and formerly of UBS, has come out with a damning report, which estimates that the total losses at Fannie and Freddie could be as high as a mindblowing $448 billion. Keep in mind that so far the government has injected $112 billion into the nationalized entities. Yet if this estimate is correct, another $336 billion will have to be funneled from taxpayers. This money will have to come from new debt issuance and is certain to add to the multi trillion budget deficit. Also, putting the banker tax in perspective, the number is nearly three time greater than the $120 billion expected to be collected over a period of many years, and causing so little ruckus on Wall Street and so much posturing by the President.
Another $336 Billion down a black hole or is it a rat hole. This is why failed businesses need to be allowed to fail.