One reason that Fannie and Freddie will never return to their earlier forms is simple mathematics: to become independent, Fannie Mae and Freddie Mac must repay the taxpayer dollars invested in the companies, plus interest. Even if the firms achieve profitability, it could take them as long as 100 years — or longer — to pay back the government. And almost no one expects the companies to return to profitability anytime soon. [1]
This is, like, so not bankruptcy remote. The pizza delivery man is knocking on the door of Congress with another National Debt as big as the one they’ve already got. Once again, hat tip to the Implode-O-Gang.
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[1]: "U.S. Likely to Keep the Reins on Fannie and Freddie", by Charles Duhigg, New York Times, March 2, 2009.
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