The economy of the United States is the world's largest national economy. Its gross domestic product (GDP) was estimated as $13.8 trillion in 2007.
Nowadays, the FED of New York stored $150 billion dollars value of physical gold, and only 2% of this value belongs to the U.S.
US Gross Domestic Product 2007 13,000,000,000,000 USD
US Total Public Debt Outstanding 9,502,657,392,916 USD
Fannie and Freddie collapse 5,500,000,000,000 USD
Gold at FED Bank in New York 150,000,000,000 USD
US Gold at FED Bank in New York 3,000,000,000 USDhttp://en.wikipedia.org/wiki/The_Gold_Vault_of_the_FED_of_Ne...
"...a site owned by Wall Street Journal pegged the losses at not ONE. I don't think the taxpayers can shoulder a $5.5 Trillion hit on top of the current $7.5 T debt being left by this criminal regime of robbers."
Freddie Mac has a loan portfolio of 1.5 trillion dollars and Fannie Mae is over 700 billion.
Together they own or guarantee some 5.2 trillion dollars in loans, or about 40 percent of the total value of home loans in the United States. (around 5-8% of what the whole US economy is worth)
"Together both firms have less than 90 billion dollars in capital reserves to ensure losses on more than five trillion dollars in mortgage debt, ...
Could anyone reasonably believe that a two percent reserve fund can cover all the losses that are likely to be seen? ..."
Peter Schiff, Euro Pacific Capital
http://www.truthout.org/article/fears-rise-trillion-dollar-t...
11.07.08 Fannie Satement
Statement by Chuck Greener, Senior Vice President; On Fannie Mae's Capital Adequacy
Fannie Mae raised $7.4 billion of additional capital in May, for a total of more than $14 billion in new capital since November of 2007. Our capital level is substantially above both our statutory minimum capital and the OFHEO-required 15 percent surplus over minimum capital. In fact, we have more core capital, and a higher surplus over our regulatory requirement, than at any time in this company's history.
As we work through this tough housing market, we are maintaining a strong capital base, building reserves for our credit losses, and generating solid revenues as our business continues to serve the market. We also have access to ample sources of liquidity, including access to the debt markets. The company issued more than $24 billion in debt this week alone, including a $3 billion Benchmark Notes® sale that was oversubscribed. In short, Fannie Mae remains well equipped to fulfill our critical role in the housing finance system, today and in the future. We will provide a full financial update and outlook when we report second-quarter results in early August.
OFHEO has reiterated that Fannie Mae is adequately capitalized, the highest capital designation given by our regulator. More broadly, Treasury Secretary Henry Paulson and leaders in Congress have also issued statements of support, for which we are appreciative.
This statement contains forward-looking statements, which are statements about matters that are not historical facts. Although Fannie Mae believes that the expectations set forth in these statements are reasonably based, the company's future operations and its actual performance may differ materially from what is indicated in the forward-looking statements in this statement. Factors that could cause actual results to differ materially from these statements include the company's results of operations for the remainder of 2008; changes in accounting principles or practices, including changes in the rules governing qualified special purpose entities; recording a valuation allowance for its deferred tax asset; continued impairments of its assets; changes in investor confidence in the company; the effect of proposed and pending legislation. Additional factors that could cause actual results to differ materially from these statements are detailed in Fannie Mae's quarterly report on Form 10-Q for the first quarter of 2008 and its annual report on Form 10-K for the year ended December 31, 2007, including in each case the "Risk Factors" section, as well as the company's reports on Form 8-K. These periodic and current reports, as well as all other forms that Fannie Mae has filed with the SEC, can also be obtained on the company's web site at www.fanniemae.com/ir/sec/.
Fannie Mae Resource Center Telephone 1-800-7FANNIE
11.07.08 Freddie Statement
For Immediate Release
July 11, 2008
Contact: corprel@freddiemac.com
or (703) 903-3933
STATEMENT BY FREDDIE MAC
McLean, VA – Freddie Mac is adequately capitalized, highly liquid and an essential part of the nation's housing system. We are in the process of finalizing our results and we estimate that at June 30, 2008, we will have a substantial capital cushion above the 20% mandatory target surplus established by our regulator, the Office of Federal Housing Enterprise Oversight ("OFHEO") and a much greater surplus above the statutory minimum capital requirement. We are not under any mandate to raise capital in the near term. OFHEO has stated that we are adequately capitalized and that we hold capital well in excess of regulatory minimums. The Director of OFHEO confirmed yesterday that we are adequately capitalized and have liquidity resources to perform our important public mission, and we are continuing to do so.
Beyond that, there are a number of options to manage our capital position. The average rate of run-off on our retained portfolio is currently about $10 billion per month, and not replacing that run-off would free up approximately $250 million of capital per month. Over the course of a year, this would free up approximately $2.5 to $3 billion of additional capital if this run-off rate remains constant. We also could consider reducing our common stock dividend. Our current annual common stock dividend is approximately $650 million.
Currently, Freddie Mac's liquidity position remains strong. This is a result of the combination of two factors: access to the debt markets at attractive spreads and an unencumbered agency MBS portfolio of approximately $550 billion which could serve as collateral for short-term borrowings.
We believe current speculation in the media around the issue of conservatorship does not accurately reflect the facts. Freddie Mac is not on the threshold of conservatorship because we are adequately capitalized. The preliminary indications of our expected financial performance for the second quarter, while reflecting the challenges that face the industry, do not point to an immediate need to raise additional capital. As the Director of OFHEO stated, we remain committed to our agreement with OFHEO to raise additional capital given appropriate conditions.
We are pleased at the expressions of support for the GSEs in their current form from senior administration officials and members of Congress.
Freddie Mac is a stockholder-owned corporation established by Congress in 1970 to provide liquidity, stability and affordability to the nation's residential mortgage markets. Freddie Mac raises capital on Wall Street and throughout the world's capital markets to finance mortgages for families across America. Over the years, Freddie Mac has made home possible for one in six homebuyers and more than five million renters.
http://en.wikipedia.org/wiki/Federal_National_Mortgage_Assoc...
