Monday, April 18, 2016

Great Rewards Await Obama for His Secrecy

RollingStone reported on President Obama's hoarding key financial documents from government sponsored enterprises like Fannie Mae and Freddie Mac.  The article stated:

In the pre-crash years, however, the firms' leaders acted less like the stewards of utilities and more like sleazy Wall Street hotshots. They made hyper-aggressive business decisions because their bonuses were tied to earnings growth. Some executives even engaged in Enronesque accounting manipulations in an effort to jack up their bonuses even further. These efforts led to record civil fines.
Former Obama Chief of Staff  and Investment Banker Rahm Emanuel served on Freddie Mac's Board of Directors during the pre-crash years.  Obama's National Security Advisor Tom Donilon was Fannie Mae's top lawyer and senior executive for years of fraudulent accounting.
The Obama administration turned Fannie and Freddie into cash cows with Treasury as their PEU sponsor:
Among other things, they demonstrate that not only did the government know the GSEs weren't in a "death spiral," it was actually quite confident in their future profitability well before it changed the bailout terms. Then and now, government officials lied about what they were doing, and why.
It will be interesting to see the names behind the bailout change strategy.  Given their past history with Fannie and Freddie will Donilon or Emanuel's name surface?