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GSEs Celebrate Geithner's Invitation To The "Recovery" With A Demand For $3.3 Billion In New Taxpayer Capital
Last week the Treasury Secretary penned an Op-Ed titled "Welcome to the Recovery" which in retrospect now appears was a terrific top tick indicator. First, the NFP number immediately following was a major disappointment and confirmation that the economy continues to follow a downward path despite trillions in fiscal and monetary stimulus. It has gotten so bad that if the Fed does not announce some form of new QE tomorrow, stocks will likely experience an unpleasant downward kneejerk reaction. The alternative, of course is just a bleak: once input prices surge, should QE2 be enacted, and banks use a new influx of risk-free reserves to bid up commodities of all shapes and sizes, currently record corporate margins will plummet, and corporate earnings will suffer correspondingly. Yes, this will occur 1-2 quarters in the future, and with a market preoccupied with the here and now, and a once-over scan of rosy headlines, the realization of what QE will do to earnings will be appropriately delayed. Yet a more notable indication of just how ill-timed Geithner's pamphlet is, was today's announcement by Freddie Mac that lost $4.7 billion and needs a fresh $1.8 billion from the Treasury. This follows last week's Fannie report of a $1.2 billion loss and a request for another $1.5 from Mr. Geithner. So yes: welcome to the recovery indeed - make sure you have your begging hat in hand demanding a total of $3.3 billion from the Treasury, when you visit the SecTres to congratulate him on a job truly well done.
From the WSJ:
Freddie Mac posted a second-quarter loss as prior-year derivative gains were losses in the latest period for the mortgage financier, which said it would request another $1.8 billion in government aid.
What is worse is that the new loss and bail out request comes at a time when the GSE was allegedly supposed to be finally getting its book back in order, putting into question just how credible the firm's monthly delinquency report is, at least as it pertains to the taxpayers' bottom line.
The company's ongoing bottom-line woes come as delinquencies industrywide have stopped getting worse. In Freddie's portfolio, they fell in June from a month earlier after being flat in May and falling the prior two months, the first declines in three years.
For the quarter, its single-family delinquency rate was 3.96%, compared with 2.89% a year earlier and 4.13% in the first quarter.
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In bizarro world only needing $3.3 billion is a good thing. Buy stocks!
hillarious headline
Tiny Timmy's Summer Time Blues
BTW, WTF ever happened to the "Recovery Summer!" that they had Biden out smirking about?
We need to keep loaning them (larger) money so they can keep paying us (smaller) dividends. Economic brilliance.
Very interesting that this story is going mainstream. The Atlantic for the love of pete!
Read it here first at ZH!!!
http://www.theatlantic.com/science/archive/2010/08/market-data-firm-spot...
Believe it or not, both the Atlantic and Vanity Fair have been running amazingly good, insightful articles about the Wall Street/DC shenanigans/connection.
Tone deaf, pencil dick, Geithner from last weeks interview on Good Morning America:
STEPHANOPOULOS: And not as fast as you expected it to either.
GEITHNER: Actually, in some ways it's stronger than we expected. We did not think we'd have -- the economy would bottom so quickly, growth back this quickly, this strong, and actually this much job growth this quickly. Now, again, parts of the economy are still very hard, very tough. But a lot of the economy is getting stronger.
How the man got his current job, after overseeing the biggest financial failures in the history of the United States, is the definition of insanity.
I cant tell who has made a bigger douche of themselves in the past few public interviews : Geithner or Greenspan.
The Maestro's latest;
“I’m very much in favor of tax cuts, but not with borrowed money.”
(Aug.1, Meet the Press)
He who begot the bubble via overly expansive credit creation birthed of extraordinarily easy monetary policy under His tutelage, He who supported the original Bush tax cuts, He who now reviles the extension thereof.....
Translation; "I may have fucked it up but yeah, ya'll get to pay for it"
"I'm very much in favor of loans to our member banks,... but not with money that has to be earned or even actually exists."
rotten motherf***ers running the show
More Pigs ganging up on the November trough...
And the market is green. I am Elmer J Taxpayer, I own a mansion and a yaught.
the madoffization of the enronification of the broke-back nation
as long as the markets are propped and controlled by the banksters, we slide ever deeper into shit
YOUR NEXT STOP...THE GEITHNER ZONE
http://williambanzai7.blogspot.com/2010/08/next-stopthe-geithner-zone.html
YOUR NEXT STOP...THE GEITHNER ZONE
http://williambanzai7.blogspot.com/2010/08/next-stopthe-geithner-zone.html
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