Sunday, April 11, 2010

Ex-Fannie execs: Greed at heart of housing mess

Recently executives of some of the largest firms linked to the mess of the financial crisis such as Citigroup and Fannie Mae have undergone interviews from the Financial Crisis Inquiry Commission. These hearings have resulted in executives admitting their faults in contributing to the financial crisis and housing market crash. The following article is pretty interesting and quotes former Fannie Mae executives admitting to taking on more risk than necessary to drive their profits for investors.

http://www.sltrib.com/business/ci_14858011
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3 comments:

  1. Jared AndrzejewskiApril 12, 2010 at 5:09 PM

    I appreciate that the execs of Fannie Mae and Freddie Mac owned up to having a major contribution to the collapse of the housing bubble. It is nice not to see another person blaming other factors besides themselves. This inquiry I think will be beneficial in finding out how to recognize another collapse and what we can do to try to prevent it or know what to do if another one happens.

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  2. Ryan BizzisApril 13, 2010 at 7:09 AM

    I agree with you Jared, however they do mention the fact that the large amount of pressure for the organization to succeed for the house buyer, shareholder, and economy contributed to this. The only way to seemingly satisfy all three of these aspects was to give subprime mortgages. Perhaps it was immoral of them to do it but they were preventing economic collapse after 9/11 and instead delayed it until now with many more consequences.

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  3. Adam ManixApril 13, 2010 at 2:06 PM

    I think it is refreshing to finally see some level of responsibility being taken by executives as a contributor to the financial crisis. The case of Fannie and Freddie is slightly skewed for me only because they were supposed to be government sponsored companies. Despite being government sponsored, they were a for-profit company that acted just as a bank like Citigroup would. I think the Government should have regulated Fannie and Freddie's business behavior because they were government sponsored instead of letting them run wild with investment banks. In this case, Government officials and the Executives should be blamed.

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