Fannie Mae and Freddie Mac, the Government Sponsored Entities (GSE’s) embroiled in the mortgage backed securities fiasco that turned a housing slump into a financial crisis are having a merry Christmas. Obama-Claus has opened your wallet and given them free reign to dole out huge compensation packages to executives while using taxpayer money to stay afloat.
While the “Pay Czar” is dictating the salaries of other financial institutions that have received bailout funds, Fannie and Freddie are exempt.
From the WaPo: The Obama administration pledged Thursday to provide unlimited financial assistance to mortgage giants Fannie Mae and Freddie Mac, an eleventh-hour move that allows the government to exceed the current $400 billion cap on emergency aid without seeking permission from a bailout-weary Congress.
But even as the administration was making this open-ended financial commitment, Fannie Mae and Freddie Mac disclosed that they had received approval from their federal regulator to pay $42 million in Wall Street-style compensation packages to 12 top executives for 2009.
Further, the goals set by the FHFA for the GSE’s subprime purchases have little changed from the levels that contributed to the credit crash.
How’s that for a lump of coal in your stocking?