Fannie and Freddie: More Welfare for Wall Street

Interesting that we’re hearing the feds are going to take over mortgage giants Fannie Mae and Freddie Mac on the eve of Jupiter going direct in Capricorn. Jupiter is expansion and Capricorn rules the financial establishment.

The lingo Treasury Secretary Henry Paulson is using is “conservatorship,” but in reality the mortgage outfits are being nationalized — by a Republican Administration.

As many financial commentators have noted, these stopgap measures to prop up the U.S. financial system are merely postponing the day of reckoning. The Fannie/Freddie bailout is going to benefit the mostly institutional holders of its bonds and mortgage-backed securities, but owners of its common shares are still at risk.

If you’re looking for more detail on the bailout from a Wall Street source, here’s a link to my favorite money maven Barry Ritholtz.

One of my first posts when I started writing this blog on Mar. 17 made the link between Jupiter in Capricorn and the efforts of the U.S. government to avert a financial crisis by rescuing Bear Stearns.

Back then, Pluto was making its test-drive in Cap. Now, it’s back in Sagittarius and going direct. Hold on to your hats! This fall’s financial roller-coaster ride is just beginning!

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2 comments on “Fannie and Freddie: More Welfare for Wall Street

  1. Pingback: Conspirama

  2. Liked the expression “postponing of the day of reckoning”. Looking at the natal horoscope of the New York Stock Exchange (May 17, 1792, 08:52 AM in N.Y. ) Sun is close to Mars (transiting), Mars closes in on a transit opposition to Moon (natal) and subsequently Saturn (natal). It will take Saturn less than a month from now to transit Mars (natal) at 18 d. 45′ Virgo and “spectacle of all spectacles” Uranus, retro, will make its station exactly (!) on Nov. 27 in opposition to this Mars. Suffice it to add that Saturn will have “executed” his own job transiting this same delicate Mars. I wonder if Bernanke uses some astrologer to get his timing right…

    The gist of all this: I remember how as a young economics student in the mid-Sixties, I was keeping an eye on economist Jacques Rueff, a close adviser to Charles de Gaulle, then Président de la Grande Nation. Rueff was warning anyone he could (beyond his boss, of course) that the Americans would have to abandon the dollar peg to gold. It finally happened in 1972.

    Only those were slow times. Today it’s a bit more accelerated. There are megatons of currency reserves (Japanese, Chinese, Korean, Arab) all wondering where to go next. Bernanke knows damn well, so he acts as if he were already on Obama’s payroll.

    As long as shareholders of Lehman and UBS etc. believe the scheme, it may all work for a while. Only smart money, when sitting on the wrong side, waits for the next best exit. As German author Berthold Brecht once said: “Den letzten fressen die Hunde” (“The last ones will be eaten by the dogs…”)

    My advice: Stay out of U.S. assets, including the dollar. That’s a prudent, medium-term view (say until Inauguration Day).

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