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In Response to Re: Re: What happens if......,. by ChiRaven
You repeat what I think of as an urban legend--that Freddie Mac and Fannie Mae were responsible for "nudging" banks to loan to unqualified individuals. Would you like to be more specific about how Freddie and Fannie might do that? Almost none of the subprime loans responsible for the meltdown were backed by Freddie or Fannie. They were all issued by private lenders who were then able to package all of these bad loans into products that were resold to other financial institutions. That is the direct result of financial deregulation. These lenders saw a way to make money without keeping any financial skin in the game. Where would you insert Freddie and Fannie into that?