Bruce Krasting Fri 2009-09-04 18:29 EDT
FHFA Report on Restructurings -- Everything is Going Fine
The FHFA released a report on their refinancing activity for the year to date. As usual it was cast in glowing terms. It is clear that FHFA is doing something. In my view that `something' is consistently the wrong thing...No private lender in their right mind would make a 125% loan. These are just losses to be. The FHFA is perpetuating the cycle of default. They are making things worse, not better...No single entity should have this much exposure to the credit market. It defines systemic risk.