On Tue, 15 Jul 2008 11:08:41 -0500, Ignoramus19502
wrote:
snip
I do not see any evidence for this.

Some people or businesses who invested in mortgage backed securities
that are guaranteed by these companies, would be a little poorer
without those guarantees. And home loans will be slightly more
expensive, as they should be. But I do not see a big fallout from
Fannie mae and Freddie Mac going bankrupt.
snip
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In an ideal and/or ration world this is indeed what should
happen, however all the economic "fire walls" and "water tight
bulkheads" have all been removed, and the failure of either of
these behomoths will be almost instantly followed by the other,
which is certain to trigger a cascade of major failures/defaults
resulting in massive CDS derivitive redemptions. These GSE
securities have become entwined and embeded in every financial
nook and crany in the world, and if these go up in flames, so
does everything else.

In turn this will sevearly limit if not eliminate most
governmental revenues at a time when demands for basic emergency
and social services will spike. [e.g. With no income and no sales
there will be no income and no sales taxes paid...]

Budweiser/InBev is a preview of things to come as our creditors
look for anything of value the can exchange their rapidly
depreciating American dollars for.

We put our own head in this noose.


Unka' George [George McDuffee]
-------------------------------------------
He that will not apply new remedies,
must expect new evils:
for Time is the greatest innovator: and
if Time, of course, alter things to the worse,
and wisdom and counsel shall not alter them to the better,
what shall be the end?

Francis Bacon (1561-1626), English philosopher, essayist, statesman.
Essays, "Of Innovations" (1597-1625).