Over the weekend were the frightening reports of the American mortgage
industry facing collapse, as IndyMac
moved into administration, followed by the departure of shareholders from
Freddie Mac and Fannie Mae faster than rats from a sinking ship. Freddie and
Fannie’s share price was down 20% on the week, raising the spectre of the Fed
and Treasury having to step in once again to protect the imploding mortgage
market, just as they have with IndyMac.
There’s a great deal of analysis of this change in the US markets and you can
find it all here, with some of the best overviews being:
- “Key facts on Fannie Mae and Freddie Mac”, Reuters
- “Freddie Mac and Fannie Mae situation in context”, Thought Theater
- “Freddie Mac’s Next Hurdle: Raise Cash”, Washington Post
- “Government Considering Takeover of Freddie, Fannie”, New York Times
On this last point however, we have a problem.