this is just what fannie mae and freddie mac know about. they buy these loans in large bulk quantity so once they investigate the 15 trillion dollars worth of loans they are sitting on they will probably find a lot more junk their going ask lenders to buy back. so we know that this is a huge problem but why is the government not forcing this issue, why is this going on for more than three months? according to the report they are saying that we just asked the banks nicely for the money back and they have said no. the next step is litigation. the authorization to sue the bank is going to come from congress and as senator durbin said the banks own congress so you are not going to see a lot of people in congress with the spine to say go ahead and sue these banks. realistically do you think in the end these banks are actually going to buy back these bad loans that they have dumped on fannie and freddie? if congress grows a spine and says we will not stick the taxpayers with this debt we are going to make the banks take these back then that could

. >> next, a hearing on the mortgage holding companies, fannie mae and freddie mac. both have been under government control since the 2008 financial crisis. last month, financial services committee chairman said freddie and fannie ought to be abottle issued. this subcommittee hearing is 2 1/2 hours. >> without objection, all members' opening statements will be part of the record. pursuant to committee rules and prior discussions, each side will have 15 minutes for opening statements. without objection, all members' opening statements will be made part of the record. i yield to myself five minutes. good morning. we meet today to focus on many strat fannie mae and freddie mac and the federal agencies to limit capital infusions into the two housing enterprises. this hearing is also the sixth in a series that we have so far convened this congress to examine the future of housing finance. two years have now past since the federal housing agency placed fannie mae and freddie mac under conserve toreship. at the request of then treasure secretary henri paul sen, this law prov

. >> bill, you recently testified in washington about your ideas to fix fannie mae and freddie mac. you called for forming a giant government agency with tighter regulations. is your idea getting any traction? can you explain how it may work? >> well, it's not getting much traction, but the fact is that 95% of the mortgages these days that are generated and that are issued are basically being guaranteed by fannie mae and freddie mac. that's the reality. and the reason it's the reality is that in terms of the private mortgage market, that lenders are requiring down payments of 20, 30, and in some cases 40%. and so the cost of that financing is prohibitive. my point is simply it's better to have the private market in the housing market in terms of finance, but it's not likely to be a significant influence. and it will be much more costly. and so for the next few years, for the next two, three, four, five years, let's examine possibilities in the out years, but let's maintain government influence, because the financing is much, much cheaper. the difference is 4% in terms of agency fina

it's been two years since mortgage finance giants fannie mae and freddie mac. received billions of dollars from the u.s. government they continue to report losses and received on how do you feel about taxpayer dollars continuing to support them this week let's talk about bad they're white collar criminals. we shouldn't continue to give them money then probably no. no what do we do. we help each other it's hard to say if they've helped. because it's hard to tell whether. what the result would have been if we didn't do anything at all so i think in terms of my business i think that some of the bailouts have been very successful for maintaining business in the in the role of the century the velocity of cash in them in. but i think in the long run wolf we'll find out we have to keep the housing market going i think there is such a low keeping the housing market going if we didn't support them any more it would collapse do you think either be a lot harder a lot more difficult than it might collapse i mean it's struggling hard enough as it is right now so why are peo

it's been two years since mortgage finance giants fannie mae and freddie mac. received billions of dollars from the u.s. government they continue to report losses and receive funds how do you feel about taxpayer dollars continuing to support them this week let's talk about that the white collar criminals. we shouldn't continue to get the money then probably no. no what do we do. we help each other it's hard to say if they've helped. because it's hard to tell whether. what the result would have been if we didn't do anything at all we have to keep the housing market going i think there is such a giving the housing market going if we didn't support them anymore it would collapse you think either be a lot harder or a lot more difficult than it might collapse and. we're so far into this might as well give them the money save everybody else does it matter that this reuters asked or any way i mean you know where eighty billion in the hole or ninety billion with them they made money out of the deal so freddie and fannie try and get out of it as best as possible the bot

how many of the homes in america are controlled by fannie mae and freddie mac. the vast majority they are not allowing market prices to exert themselves they're not allowing the market to tree down to reflect the demand there artificially keeping prices high for housing in america it's a it's a zombie economy for this very reason the only thing that anyone creating policy in the u.s. government should do right now is to let housing fall to where supply is equal to demand stop subsidizing housing immediately all you're doing is prolonging the agony obama you know see this for allowing fannie mae and freddie mac. to continue to support house prices as you as you are doing you are a sadist sir you deserve it in the mark you saw on house of sadism but there is albeit with credit cards and these credit cards are refusing it gives them purchasing power that would not otherwise exist sending false signals to the market so people keep on producing stuff for this economy where the people are zombies. but it also is like a futuristic war movie it's like they have zombies

come from wages it came from borrowing against our house that was being pumped up artificially by fannie mae and freddie mac. and wall street then the party ended the house prices collapsed and you're just left there with a falling wage no asset no network and no country. i mean that's that's that's that's one of the spending power came from the borrowing from debt that's all we're talking about the the the american experience of shopping came all not from wages they haven't worked a day in their life for decades they've been living along just of the chinese for decades they don't go work anymore. they're both america's balms you know welfare bombs or war for bombs they've got nobody who's working a day in their life any more so their incomes are falling but they keep on consuming so look what happens in europe in greece when incomes are falling people stop consuming and look what happens greeks get cheaper ikea shelves us prices drop and recession ikea slashed the price of billy bookshelves whatever those are in greece by twenty two percent france sect coachella in a statistician at the o.e

. >>> fannie mae is offering help to military families struggling with the death or injury of a loved one. the payment drinks last up to six months. fannie mae is the biggest mortgage supplier in the country. >>> the federal government wants more trash clean out of the river. and the water bottles, cans, food wrappers, and plastic bags float along the river in the letter its banks. they have ordered prince george and surrounding counties to pick up the river. skimmer boats already removed 400 tons of trash per year. >>> it is time to talk about the weather on this monday. it seems like something is going on. >> we just got word of a tornado warning in howard county. a chance for severe thunderstorms. this is pretty 7. i will go to doppler 7 so we can zoom in. it does not look all that impressive on the radar. the national weather service recently issued a tornado warning for howard county. it is shaded in bank. -- in pink. this is the area of concern. i was the agree can get a better look at this storm. -- i want to get a better look. this is along highway 32 and the intersection of 1

. >> fannie mae, we talked about this a month ago. home path came out, fannie mae is trying to get rid of the inventory they hold, the properties they took back. they are offering low downpayments and no mortgage assurance which is sort of appealing. now they are coming out with a program that started september 23rd, they will allow to you buy the properties and they will give you up to 3.5% of the final sales price and closing cost help. that is another additional incentive. they will also give realtors a $500 bonus for telling -- $1,500 bonus for selling the properties. it has to close december 31st of this year. you probably don't want to make an offer on the house later than say, early november. the government can take a while. >> do you like it? >> i think it's one of those things where fannie mae is looking, with all the inventory, priceses aren't really going up. if they go down by 1% they are losing hundreds of millions of dollars. also the maintenance to keep them up to date. it's ansennive to get rid of it. however, it's our

>> fannie mae and freddie mac are not in a crisis. >> cheryl: barney frank about to repeat history? at the massachusetts democrat is pushing fannie and freddie to do now that some say will make the last crisis look like a picnic. hey, lawrence, my parents want to talk to you. oh. about what? uh, they don't really think you're an exchange student. what? they think you're a businessman, using our house to meet new clients in china. for reals, player? [ woman saks chinese ] they overheard a phone call. speaks chinese ] something about shipping with fedex to shanghai. and then you opened a bottle of champagne. that was for a science project. [ man and woman speaking chinese ] i'm late for..occer... rehearsal. [ man speaks chinese ] you and i are cool? i'll be home by curfew. [ male announcer ] we understand.® you need a partner who can help you go global. fedex. >> cheryl: coming up, barney frank at it again to call for fannie and freddie to back more home loans. didn't that get us in the mess in >>> hello, everybody. i'm uma pemmaraju in washington. lisa murkowski has now re-entered the

host: you were at freddie mac from 1995 to 2003 and fannie mae in 1994. should these agencies be dissolved and have something new? guest: actually, there are many good proposals on the table. there is one that is being looked at closely by the housing policy council. but i think that we really need to look at this whole hisically and ask ourselves. we have mortgage interest deductibility. we have the federal home loan bank system which i'm not hearing much in terms of reform but needs reform. i also think that both fannie mae and freddie mac we need to think about the rules under which they actually operate, but you cannot pull the rug from underneath the housing market. so it is a tricky business. there is a shorter-term plan that needs to happen and shorter-term plan in terms of using the institution toss keep the mortgage market steablized. host: a tweet from a client. guest: if there are institutions that have operations within the united states, it will be monitoring that from a data standpoint as well and analytical standpoint. the other thing that

fannie mae and freddie mac. they were as ropacious as any group.nd this is dealt with in great detail in my book which takes very few prisoners on either side in either party. but fannie mae and freddie mac, with the support of people like bonnie frank and even many in the black caucus said, no, no don' tch fane ma and freddie mac, they'll help poor people get into their homes. sure, a lot of minorities got in their homes. they lost their savings. they're now hurting. they're being foreclosed so the dream was not a have, have not thing. it was supposed to be emancipation of americans who were supposed to get a piece of the pie. so the first thing is if we do this thing of keeping people's homes, we're helping a lot of working people and poorer people. this is not something to benefit the rich. the rich made out lik bandits in this kind of market. t secondly i we can'tut floor on housing foreclosures if we can't stem this bleeding right now, we're not going to get consumption back. if we don't get consumption back, people consuming based on their se

and the decrease marked the second street from hundred 85,000-- >> and the mortgage giant, fannie maeamericans and more cautious. about purchasing homes, that 47 believe that home prices will remain steady. 31 percent believe a slight rebound. 70 percent of americans things that it is a good time and that is up from january. but 33 of would likely to rent their next home. if there were to move. >> equip live look outside and it is slow going on the james 101 be split. the 80 along the top of your screen slowing making its way to the bridge. we will be right back! [ male announcer ] barbara boxer. she fought to get our veterans the first full combat care center in california. her after school law is keeping a million kids off the street and out of gangs. and she's fighting every day to create new jobs. i'm working to make california the leader in clean energy. to jump-start our small businesses with tax credits and loans to create thousands more california jobs. i'm barbara boxer, and i approve this message... because i want to see the words made in america again. iyou inhale, they inh

you can see that with the results of fannie mae, a freddie mac, and countrywide. this allowed a monoline institution go into a far larger institution that had diversified risk. the issue with wachovia is that it had a lot of other risks that exposed it to sensitivities in the market and liquidity in that market. one of the questions you had about whether we missed anything, the toughest thing as a supervisor and having to go to my board of directors, it is tough to not have a viable options for them. one of the things i do not think that we fully appreciated was the sensitivity to the capital markets and the funding markets to the credit risks in some of these markets and how quickly that pull-back could be. with wachovia, you can see the rating was 3. we actually had in our lidi system, had wachovia-in march of 2008. that institution would be subject to a downgrade within the next 12 months. we had a discussion with the occ and they subsequently downgraded that institution. we did have concerns about it. the sensitivity to funding markets was something we did not

cuts for everyone including millionai millionaires, ending bailouts, ending government control of fannie mae and freddie mac. they want to cut government spending back to 2008 leve. this is a plan they're hoping will help them in november. >>> in new york last night after barely completing one sentence, president obama has heckled for gay rights and aids funding. it forced the president to go off script many times insisting his administration has ireased aids funding and is working to overturn the law on gays serving in the military. he then sold the hecklers to go bother republicans after they didn't low the don't ask, don't tell policy to be repealed. > officers clipped what they believed was a stolen car. one suspect jumped out and attempted to run away from officersbut was quickly grounded with a stun gu the other suspects are dragged from the vehicle and taken into custody. >>> in new mexico, an amateur astronomer captured a rare sight traveling across the sky. a bright meteor moving north, traveling right pt the moon. the amazing foota was captured with an experimental all sky optical

. >> fannie mae offering cash to buy foreclosed homes across the country. >> here's jane king. >> ifthinking of buying a foreclosed property, listen up. the mortgage lender fannie mae offering buyers across the country 3% of a purchase price back used for closing costs or to buy a home warranty. brokers also offered an extra bonus. meantime texas now joining the states investigating practices at allied financial gmac mortgage unit. the office banning with iowa and florida looking into the foreclosure practices including whether its employees verified they had defaulted on loans. gmac practicing might have been faulty weeks before the foreclosure sales last friday. and investors today also tracking the housing market. we'll be getting a report on august new home sales about a half hour after the opening bell. we had a lower closure of stocks yesterday on concern about a jump in weekly unemployment claims. if you don't have an i-pad yet, here's an alternative. hewlett-packard giving away its tablet cp. a catch. you have to be able to buy a $400 photosmart printer that comes with it. if

over and over, the bush administration had asked congress to stop fannie mae and freddie mac, to reen it in, and to -- to rein it in, and two republicans, -- and to republicans' dismay and dishonor, it was not done. certainly the democratic friends across the aisle were objecting. the man who was to become chairman, barney frank, was objecting, of course we've seen the speech where he said no, they were fine, in essence. they were not fine. they were in big trouble. and nothing was done. it should have been. if we look back and find that fannie mae and freddie mac, they weren't sitting dormantly on the side, oh, no, they were actively involved in politics. if you look at the period as open secrets did from 1989 to 2008, to find out who gained the most in political contributions during that period, from fannie mae and freddie mac as they sought to try to entrench their future. the second highest amount of contributions from fannie mae and freddie mac went to a senator named barack obama. things changed, didn't they? and now we have the book come out from mr. wood ward -- mr. woodward,

just abort fannie mae and freddie mac. whether we like it or not. that short of an update on the week's top stories stay with us. more news today violence is once again flared up. these are the images the world has been seeing from the streets of canada. giant corporations are on the day. every month we give you the future the best in science and technology from across russia and around the world. join other technology update on our jeep. with. this data data generated from an electrical grid. you can do to do it in california. energy sources. let's go to support of. you watching all teens repeat russia's southern republican north as well as the seventeen victims of thursday's marketplace cobwebby. who survived the attack and lost their loved ones because it's. more than a thousand demonstrators question the anniversary of nine eleven and to build a mosque near ground zero we look at why a growing number americans are converting to islam despite claims that fewer than ten minutes and towards muslims. are also playing with knives a video of a u.s. so

at this point, because of fannie mae and freddie mac, it is not possible to use supervisor mar and the mayor created, to put expenses for upgrades for efficiency on your house on your mortgage, so that means that we need to be more proactive and create a program, so i would urge you8k! to helpe the first steps to deal[é)@ñ this sludge problem and other waste problems like it, to include in your master plan for sewage system master plan, a pilot project for various types of composting and other similar types of toilets so that we can see what works, what is the to given away. if you would, when that whole process comes up for a final vote, include a good, comprehensive final project for any other public comment? next speaker please. >> thank you. my name is page thomas elliott. i'm from the center for food commission on the sewage sludge composting issue, and it still has not been formally answered, formal response to the petition, and since the issue will be on the agenda in wf additional comment then on the issue as well as provide additional statements, and we wanted to inform the c

best as possible the bottom line is the us government is probably going to continue to support fannie mae and freddie mac. whether we like it or not. i'll be back in just a few moments with a headline stay with us. close up came has been to their hang me. for the first russian fleet was born. our t. goes to the area which holds talk a solution in oil and gas resources. where the biggest russian salmon can be our processing factories located. somewhere unique species of farm fauna can be found. come to the site culling region. should close up on all. for the full story we've got. the biggest issues get. face to face with the news make. more news today. these are the images. from the streets of canada. today. the main stories we've been covering this week to be russia's southern republican. the seventeen victims of thursday's marketplace kabul they are teammates those who survived the attack coming across the middle it's. none of the even remembrance day in the u.s. has been marred by clashes that the plans for a mosque near ground zero and some public burnings on. how to build a working de

according it a new survey by mortgage giant fannie mae, 70% say this is a good time to buy a house. that's up from 64% in january. the problem is getting a loon. the 30-year fixed rate has been below 5% for 19 straight weeks now, but applications for new home loans actually fell last week, in part because banks have tightened their credit standardses. but finally, lenders may be loosening up, according to the fed's latest survey of loan officers. >> we saw the first easing in lending standards for prime mortgages in four years' time. so it's importanting from it can be sustained. >> reporter: but with millions of foreclosures potentially still in the pipeline, it could be another two years before we see a turnaround in the housing market. anthony mason, cbs news, new york. >> couric: now, it's not just home buyers who are having trouble getting a loan. small business owners are as well, but relief is on the way. republican senators voinovich and lemieux helped democrats break a g.o.p. filibuster of a bill that will create $30 million in credit for small businesses. the house is expe

problem to have appeared our government's 3 the agency are supporting housing because companies like fannie mae helping flood the market with cheap mortgages. when they take that away it's going to hurt and were going to pay the piper eventually. i believe the analyst is great for 2015 is about the right time for housing to stabilize and normalize and to get all the inventory watch out of the system. we also got california numbers especially coastal doing well. the starting to recover i'd stay away from inland california. the further inland the more looks like there's you have states and has to my problems. >> what can we live and learn from the san bruno explosion? >> as an investor you can take advantage of the opportunity. when were reporting bombs in terrace and house is burning down stock to drop its already recovered. the second thing you learn is you have to update your insurance on occasion because weird things happen in houses burned down on top of that of there's a third thing we can learn make sure you update your will and have the proper life insurance because these people in san br

and government mortgage finance agency's freddie mac and fannie mae have been trying to force banks to buy back $11 billion worth of bad loans that they made because it did not meet underwriting guidelines. well, this week agency officials say those banks have been stalling for more than three months. and first, let's head over to the cme group and join george tkaczuk of rmb group. george, we've got the s&p 500 up at resistance levels up for the s&p 500 around 1120. so how do you think this could play out, could we actually see a break out or not? i think it's very possible we can. what we week in august the market bottomed. since the market's been moving up really on a strong basis, the up days have been a stronger volume than the down days. we've haven't seen any significant selling days. and along with this we have the retail sector participating, it's come off its bottom. you got the financials participating, then the tech sector, software sector which really didn't correct much at all through this whole period during the summer. it's really leading the market. so this morning what

for everyone including millionaires ending bailouts, ending government control of freddie mac and fannie mae and want to cut government spending back to 2008 levels. this is the plan they're hoping will help them in november. amara. >> tracie potts reporting, thank you. >>> a hot topic on "the rachel maddow show." she asked governor ed rendell why the health reforms aren't pore popular. >> the health care reform bill was popular when you broke it down into segments. it got spun out of control and people don't like the concept or the idea but they like the individual stuff. i was in pittsburgh today at a senior center talking about the 250s. i'm in harrisburg tomorrow with some 24-year-olds who are now being covered through their parents. they lost their jobs but they're covered by their parents. people see that stuff and say, oh, yeah, the high-risk pool. the pre-existing condition and for small businesses, you know, the republicans have been saying, absolutely lying saying this is going to drive up costs for small business, well, in pennsylvania, there are 150,000 small businesses under 25

. >> it stopped the down economy with fannie mae and freddie mac people couldn't afford the buy houses and the market collapsed and housing market is going down as fast as the democratic party. >> gregg: rick and rich, good to see you both. >> julie: well, before making a final ballot decisions, many voters are waiting to see what congress does about expiring tax cuts. president obama and many democrats want to end the bush era cuts for wealthiest americans but many recipes says raising taxes on anyone isn't the answer to our financial crisis. julie, we got some answers on the timing of the tax cut vote. what is the word. >> reporter: the number two democrat in the house appeared, steny hoyer he doubts there be vote on tax cuts meaning that americans are going to have to wait until after the november elections to find out what their tax rates are going to be, on income, dividends and capital gains. hoyer says it's republicans support for tax cuts for the rich which is holding up a tax relief for everyone else. here is hoyer. >> if such is the sentiment it westbound speesh us on act but

repeal president obama's health care reform law, and end government control of the mortgage giants fannie mae and freddie mac. democrats immediately blasted mostly the tax portion of the pledge, saying it will increase the deficit by giving tax cuts to millionaires. >>> one more note on health care reform. it's been six months now since congress passed the obama plan. and so major provisions of it go into effect tomorrow. among them -- dependents will now be covered under their parent's insurance plans up to age 26. children under age 19 can no longer be denied coverage because of preexisting medical conditions. and insurers will no longer be allowed to put lifetime limits on coverage. >>> when our broadcast continues on a wednesday night, life saving cancer drugs that cost a fortune. whether you can pay can become instantly a matter of life and death. >>> a new documentary about fixing public schools that's making waves tonight. >>> think about this, you have a potentially terminal disease and there's drug to make you better and you can't afford it. it happens all the time. the choices are p

you can see that with the results of fannie mae, a freddie mac, and countrywide. this allowed a monoline institution go into a far larger institution that had diversified risk. the issue with wachovia is that it had a lot of other risks that exposed it to sensitivities in the market and liquidity in that market. one of the questions you had about whether we missed anything, the toughest thing as a supervisor and having to go to my board of directors, it is tough to not have a viable options for them. one of the things i do not think that we fully appreciated was the sensitivity to the capital markets and the funding markets to the credit risks in some of these markets and how quickly that pull-back could be. with wachovia, you can see the rating was 3. we actually had in our lidi system, had wachovia-in march of 2008. that institution would be subject to a downgrade within the next 12 months. we had a discussion with the occ and they subsequently downgraded that institution. we did have concerns about it. the sensitivity to funding markets was something we did not

as president obama has increased the amount of housing debt that fannie mae and freddie mac and therefores have to pay, guess what? the fall rates have -- default rates have gone up. default rates in mortgages are at an all-time high. default rate of student loans of guaranteed government loans at 6.9%. that's the highest in 12 years. >> david: stephane, you know, ultimately -- >> we're in a recession. >> david: taxpayers ultimately will pay for defaults, right? >> i'm not sure i heard the question but we could start going after the government loans made for education at for-profit schools. the for-profit schools are a problem. administrators are urged to chase profits or urged to chase kids. that's not a healthy conflict. i don't have a problem with the for-profit education. i have a problem with government subsidiaries for it. as far as the conspiracy theory, is the white house hoping there will be more default, anyone thinking that is mixing up the dinesh and desusa. >> david: i have to agree with stephane, if you are a for-profit entity, you shouldn't get taxpayer bail-out, correct? >

it goes to show you how removed, gretchen, fannie mae is from things. let me explain happens.se money, they would buy loans from lenders and then they sell these loans to fannie mae as securities with no money down, generally up to $1,000, from a home buyer. you have to be a first time home buyer, have a score of 680 or more, have to go to counseling. but let me read you quickly. last week mr. demarco, the head of the federal housing finance agency, that testified in congress said this one got away from us. in other words, fannie mae, who we've given $150 billion for, is back again in the business of buying loans. it just shows you how removed these people are from reality. >> gretchen: how could that possibly be? >> well, because it just goes to show you -- don't forget, this is the government who wants to run everything in this country. it basically slipped through the cracks. i don't know how it happened except i have to say it's malfeasance. >> gretchen: is it a good thing for people? if i'm a home buyer and i can write a closing cost check for 67 cents, is it good or lead

plan calls to cap spending at 2008 levels, repeal the health care law, end government control of fannie mae and freddie mac, and extend bush tax cuts permanently. the plan isn't exactly original. in 1994, newt gingrich unveiled "the contract of america" that helped the gop take back the house that year. with this plan, they made clear that they want to take america back to the same failed economic policies that caused this recession. here's former president clinton's advice for democrats addressing the american people. >> which idea is most likely to work. that ought to be the debate. what are we going to do? who's more likely to do it? and i think -- i believe they should say, give us two more years to do this. if it work, you can throw us all out. >> j.d. hayward joins me now. j.d. got a lot of support from the tea party folks in his day. it looks like in many ways the republicans are trying to capitalize on some of that enthusiasm, some of that fervor. do you think their pledge to america stands up to what those people would expect, j.d.? >> i think it's an important first step, contessa

treasuries down in percentage terms over the past month or two, basically it was to buy, yes, those fannie mae and freddie mac mortgages at 4 and 4 1/2%, and to buy corporate bonds in the same yield category. so simply a move to increase yield with a modicum of safety involved. >> so bill, what would be your advice to investors right now? for that person out there that is looking at this new normal, as you explained it, what does it mean for them, for the average person out there that the east is rising and it seems that the west is declining? >> well, it means that the returns are going to be lower. if they're looking for 10% pace of returns to pay for college, or to pay for retirement, basically that's not in the cards. so an investor should expect 4 to 5%. it doesn't have to be in bonds. kit be in stocks there are decent alternatives in a slow-growth environment in the stock market that incorporate global types of companies. for instance, johnson & johnson yields 3 1/2%. that's an attractive high quality stock. merck yields 4%. that's an attractive stock. you know, selected utilities such a