bailout

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Why AIG Got a Bailout (and Lehman Didn't)
 Why AIG Got a Bailout 
 (and Lehman Didn't) 
ANALYSIS
Sep 17, 2008 7:40 AM CDT

Why AIG Got a Bailout (and Lehman Didn't)

Credit default business dooms, saves giant

(Newser) - The Federal Reserve seemed to draw a hard line against bailouts with Lehman Bros., but just days later it stepped over that line to save AIG. Why?  First, says Time: Size. Its implosion would have been "as close to an extinction-level event" as we've been since the Depression. But...

Morgan Stanley Likely Shopping for a Merger

No. 2 investment bank looks to avoid Lehman's mistakes

(Newser) - Morgan Stanley is rumored to be considering whether to merge with a deposit-taking bank, reports CNBC, in the wake of Lehman's collapse after repeatedly shunning buyout offers. And while the company hasn’t yet found a partner, insiders say that its sliding stock price makes survival unlikely without a well-capitalized...

Hank and Ben: Time to Play Offense
 Hank and Ben: 
 Time to Play Offense 
OPINION
Sep 17, 2008 7:15 AM CDT

Hank and Ben: Time to Play Offense

Treasury and Fed need to start playing offense, says Leonhardt

(Newser) - If you'd told economists 18 months ago what lay ahead in the financial industry, predictions for the American economy would be dire. The fact that things aren't totally awful—we still haven't entered into a recession—is testament to the good defense of Hank Paulson and Ben Bernanke. What they...

AIG Rescue Boosts Euro Stocks; Asia Rally Fades

Still 'edgy,' notes analyst

(Newser) - European stocks edged up today for the first time in three days on news of the US government's $85 billion bailout of insurance giant AIG—but an early rally in Asian markets faded, reports Bloomberg and the New York Times. Europe's Stoxx 600 climbed as much as 1.9% after...

Pols Pitch Federal Agency to Take On Bad Debt

Agency would formalize what feds are already doing in money crisis

(Newser) - The idea of creating a federal agency to dispose of the toxic debt at the heart of the credit crisis is gaining traction in Washington, the New York Times reports. The proposed agency would resemble one set up in 1989 to resolve the savings and loan crisis—but in a...

Paulson Played Cards Well in High-Stakes Showdown
Paulson Played Cards Well
in High-Stakes Showdown
ANALYSIS
Sep 16, 2008 12:27 PM CDT

Paulson Played Cards Well in High-Stakes Showdown

Paulson, remaining banks struggle to pull the market back together

(Newser) - Cue the Kenny Rogers, suggests Steve Pearlstein in the Washington Post; “Hank Paulson knows when to hold ‘em and when to fold ‘em.” Paulson was so determined not to commit federal dollars to bail out Lehman Bros. that when the banks said they couldn't step in...

Feds, Banks Seek Lehman Deal by Tonight

BofA, Barclays balk at bad assets, but bailout not in the cards

(Newser) - Washington and Wall Street continued talks today aimed at solving the Lehman Brothers crisis as early as tonight, the Wall Street Journal reports. Federal Reserve officials still refuse to approve a bailout like the one that enabled JP Morgan to acquire Bear Stearns this summer—but possible buyers like Bank...

Bank of America in Talks to Buy Lehman Bros.

Investment bank looking for buyers to save it from collapse

(Newser) - Bank of America is in preliminary talks to acquire struggling investment bank Lehman Brothers, the Wall Street Journal reports. Lehman has been shopping itself around in a bid to stave off collapse, but potential suitors are wary. Many want Washington to assist with a sale of the bank, whose shares...

Mortgage Rates Fall After Fannie, Freddie Bailout

Average 30-year loan rates drop nearly half a point

(Newser) - The federal takeover of Fannie Mae and Freddie Mac sent mortgage rates plummeting today, MSNBC reports. The average 30-year fixed rate mortgage dropped nearly half a percentage point to 5.88%, dipping below 6% for the first time since January. The average rate for a 15-year loan is down to...

Fannie, Freddie CEOs in Line for Millions in Severance

Mudd, Syron each stand to net at least $6M; critics rip 'pay for failure'

(Newser) - The CEOs of Freddie Mac and Fannie Mae will receive millions in severance pay, pension payouts, and other benefits after the government’s takeover of the mortgage giants, the Los Angeles Times reports. Fannie’s Daniel Mudd stands to take away $7.3 million, and Freddie’s Richard Syron will...

Bailout Likely to Sink Some Small Banks

Those with significant Fannie/Freddie stock face capital crunch

(Newser) - The government’s takeover of Fannie Mae and Freddie Mac, and the resulting crash of the value of the companies’ shares, has started a domino effect that likely will push some smaller banks into failure, the Washington Post reports. Some institutions heavily invested in the seemingly safe stocks will find...

Battle Lines Drawn in Freddie, Fannie Fight

Making mortgage giants public, breaking them up or nursing them to health seen as options

(Newser) - What Freddie Mac and Fannie Mae look like in the future—and whether they continue to exist in a recognizable form at all—depends on how Washington looks next year, the New York Times reports. The battle already has begun, with the White House and congressional Democrats blaming each other...

US Must Strike Fine Balance on Mortgage Bailout
US Must Strike Fine Balance on Mortgage Bailout
Analysis
Sep 8, 2008 11:34 AM CDT

US Must Strike Fine Balance on Mortgage Bailout

Deficit makes coordinated response economically, psychologically crucial

(Newser) - A global storm continues to threaten the world’s economies, and the US government takeover of Fannie Mae and Freddie Mac is just one step, albeit a major one, toward recovery. Whether the latest attempt to right the ship succeeds "ultimately boils down to two big issues," writes...

Dollar Soars to 1-Year High
 Dollar Soars to 1-Year High 
Sep 8, 2008 8:06 AM CDT

Dollar Soars to 1-Year High

Greenback climbs higher still after Fannie-Freddie bailout

(Newser) - The dollar rallied to a 1-year high against the world's currencies today, following Treasury's decision to seize control of Fannie Mae and Freddie Mac. After an early hiccup, the greenback advanced to $1.41 against the euro while also climbing against the yen, the pound, and the Swiss franc. While...

Stocks Rally Strong on Fannie, Freddie Takeover

Europe, Japan, US futures see market surge

(Newser) - European and Japanese stocks saw their biggest surge since January and US futures climbed amid news of the Treasury Department’s plan to take charge of Fannie Mae and Freddie Mac, Bloomberg reports. Europe's UBS AG, pounded by subprime losses, and Japan’s Mizuho Financial Group, its biggest bank by...

Juggled Books at Freddie, Fannie Sparked Fed Takeover

Situation more dire than accounting revealed, probers found

(Newser) - Federal advisers pushed for a government takeover of Freddie Mac and Fannie Mae after discovering fuzzy accounting that failed to fully reveal the dire nature of the companies' financial situation, reports the New York Times. The practices, while not illegal, overstated the mortgage giants' capital cushions while attempting to delay...

Feds Plan to Take Over Freddie, Fannie

(Newser) - The White House told ailing mortgage giants Fannie Mae and Freddie Mac today that Washington will effectively take them over, the Wall Street Journal reports. The Treasury move will leave both companies functioning but replace their executives, inject capital, and likely leave shareholders with little or nothing. The move aims...

Pressure Mounts for a Freddie, Fannie Bailout

Investors want Treasury to take the lead on mortgage giants sooner rather than later

(Newser) - A federal bailout for Fannie Mae and Freddie Mac looks more likely every day, both the Wall Street Journal and the New York Times report, as the mortgage giants find it increasingly difficult to borrow and their stock continues to take a pounding. Freddie was able to auction $3 billion...

House Passes Huge Housing Rescue Bill

Measure should clear Senate soon; Bush says he'll sign it

(Newser) - The House today approved a massive bill to provide relief for struggling homeowners, communities hit hard by the housing crisis, and mortgage giants Fannie Mae and Freddie Mac, the Hill reports. The bill passed 272-152 hours after President Bush switched course and said he would not veto it. The measure...

Freddie Eyes Selling $10B in Shares to Stave Off Bailout

Measure might prevent need for bailout - for now

(Newser) - Freddie Mac is considering issuing $10 billion worth of new common and preferred shares, the Wall Street Journal reports, a move that might stave off a full-blown government rescue—and the increased scrutiny that would come with it. Freddie has been emboldened by two days of big gains, with shares...

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