Fannie Mae has more than 600 million shares of preferred stock outstanding. Freddie Mac have about 460 million shares outstanding. Preferred stocks pay a high dividend and companies buy them for the relatively safe, consistent cash payouts they offer.
There is much concern now because the preferred shareholders are basically the banks and insurance companies. And no one is clear whether they would see their dividends if the tax payer was forced to step in such a massive way.
The financial industry takes another big hit because of all of these institutions are part of the same fabric. If it begins to sound like a house of cards...it is.
Congress estimates a government rescue of Fannie and Freddie could cost taxpayers $25 billion, with the exact amount based on how far the U.S. housing market falls.
Its becoming clear that some parts of the American financial system have ceased to function. The Japanese real estate crises in the 1980's was a huge implosion much like this one. Although great amounts of wealth were lost and markets never completely recovered, they still remained the #2 economy. And so we will weather this too. Amen
Thanks for Reading
Howard Bell
www.yourpropertypath.com
A web site of over 450 articles related to real estate focused primarily on property management.
Your Property PathSF
http://yourpropertypath.blogspot.com/
Trade talk for the San Francisco real estate industry. Your source for property management tips, policies and market trends.
Your Property Path Amazon Store
http://astore.amazon.com/yourpropertypath20-20
super deals on mobile office today
We hand picked Amazon for the tools you need
You can add this page to your favorite Social Bookmark site:
No comments:
Post a Comment