Jackson Jambalaya

Jumpin' jimminey crickers. Senator Chris Dodd is "troubled" about the government takeover of Fannie and Freddie:
"Dodd has said he is troubled about the plan. "First of all, I want to know the motivations for it," he says. "We passed a major, landmark piece of housing legislation about a month ago, in which was included newly sought authority by the secretary of the Treasury to possibly take equity positions within Fannie Mae and Freddie Mac — with a quick assurance by the secretary of the Treasury that that authority would never be used — but now, getting a far more aggressive action taken by the Treasury. So I clearly have a question: What transpired? The second question I have is: What [effect does this] have on home mortgages, on homeowners...
Some critics have accused Congress of failing to adequately regulate Fannie and Freddie to prevent such a crisis, but Dodd says reforms were included in the housing bill passed this summer, after seven years of failed efforts....." http://www.npr.org/templates/story/story.php?storyId=94407478

Of course he is troubled as he has been the agencies' congressional tool for years. It was Senator Dodd, along with some other Senators, who received sweetheart deals from Countrywide as a member of the "Friends of Angelo Club". The Wall Street Journal reported on June 13, 2008,
"Sen. Christopher Dodd, a top figure in Democrats' response to the housing crisis, defended through a spokesman two mortgages he reportedly received under a special Countrywide Financial Corp. program that awarded preferential interest rates to people referred to as "friends" of the company's chairman and chief executive, Angelo Mozilo."

It was Senator Dodd who tried to bail out Countrywide earlier this year. The WSJ editorial on June 19 criticized the Senator for his questionable ethics:
"How much will Countrywide benefit from Mr. Dodd's rescue? The Senator's plan allows mortgage lenders to dump up to $300 billion of their worst loans on to taxpayers via a new Federal Housing Administration refinancing program, provided the lenders are willing to accept 87% of current market value. The program will be most attractive to lenders and investors holding subprime and slightly-less-risky Alt-A loans made during the height of the housing bubble in 2006 and 2007.
As the market leader during that period, Countrywide originated $167 billion of such loans, more than 11% of the nationwide total, according to Inside Mortgage Finance. Analyst Fred Cannon of Keefe, Bruyette and Woods estimates that the company is still holding more than $30 billion in subprime and Alt-A loans on its books, based on the company's most recent quarterly financials.
Even for the loans Countrywide has already packaged and sold, the company would still benefit from the bailout. That's because Countrywide continues to service the loans, and every loan that goes bad means increased costs for the servicer...." http://online.wsj.com/article/SB121383295591086669.html

The website Mortgage Implode-O-Meter was even sharper in its criticism:
"This $300 billion Dodd-Shelby bailout is an absolute crime. It bails out the banks by limiting their loss to 10%; a joke since many of the problem areas like CA are down as much as 30% already on the median in the past 12-months and the rate of acceleration of the price declines are picking up steam. The subprime crisis is nearly over and now Prime, Alt-A, Pay Option ARMs and Home Equity Lines/Loans are failing. If they get this $300 billion passed, another $1 trillion+ will have to come on its heels for all of the other bailouts." (Is anyone laughing at the $1 trillion figure now? ) http://mrmortgage.ml-implode.com/2008/06/21/bofa-perhaps-countrywide-wrote-dodd-shelby-bailout-this-news-must-get-out-there/

Unfortunately for Senator Dodd, evidence came out proving Bank of America/Countrywide wrote his beloved bailout bill as National Review obtained a copy of a Bank of America document so similar to Dodd's bill there is no question who the true author was.
http://corner.nationalreview.com/post/?q=ODJkN2Q3NTY0MjAwYjJlNTY0NTJmMWEzZTI1OGZjZTg=
Bank of America Document: http://www2.nationalreview.com/dest/2008/06/20/bofa.pdf

Meanwhile the taxpayers, will spend close to one trillion dollars bailing out the housing industry. Mr. Dodd helped his friends at Countrywide dump their garbage on us while making sure Fannie and Freddie were allowed to keep their ability to lobby Congress and the shareholders kept their equity and dividends (that power was revoked in the government takeover). In a few years, the agencies would have been back on Capitol Hill, using their power-brokers to remove their shackles so they could yet again drive the housing market into the ditch. Meanwhile, Senator Dodd is "troubled".