RIP Fannie Mae & Freddie Mac
The two companies that own or guarantee half of the nations $12 TRILLION dollars worth of Mortgage debt are likely going to be effectively nationalized.
What does this mean? 1) Any shares or bonds with FNM or FRE are going to be next to worthless. 2) The American tax payer is going to eat this. 3) your money market funds are secure.
I don’t really know what should have been done. Americans are having a mega-exodus from credit mentality yet our entire economy relies on credit. Our economy relies on it’s growth, it borrows on our growth, yet the growth can’t happen without credit. If we completely get out of debt, we’re screwed. Yet we cannot contain our debt without inflation. In the long run, individuals get screwed.
Basic advice: Get out of debt and learn a trade skill.