In working my side job yesterday, I was pleasantly informed that I made the Rocky Mountain News! I was riding my pedicab on the mall and was asked to have my picture taken.
Lo and behold, I made page 7 press. Read the article.I love it!
In other news, the biggest news-maker has been this debacle of Fannie Mae and Freddie Mac. Just to be clear, there is so much to know about this, so in this post, I will outline the origins and why it is having such a large effect on our real estate market.
Fannie Mae was created by Franklin Delano Roosevelt, in 1938, to provide liquidity to the mortgage markets. It received federal funding until 1968, when it was converted to a privately held corporation.
Its use in current day mortgage market is that it provides guarantees (for a charge) of loans, more specifically, of the secondary market. The secondary mortgage market is in a bit of trouble, due to sub-prime lending practices.
It should also be said that the Treasury Department and the Federal Reserve (not a government agency, mind you) recently granted low interest loans to Fannie Mae and Freddie Mac to sure up confidence in many failing and problematic mortgage backed securities in the U.S. stock markets. It is an interesting political note, as well, that the prohibition of the U.S. Treasury Department to own stock of Fannie Mae, has been removed.
What are the implications for this thing? We don't know, ultimately. We are noticing an enlargement of government power, which won't allow the market to fail, then correct itself. I believe that this may be necessary to get us back to a nursing point, but I am a fan of Laissez-Faire- in other words, the market must correct itself. It has been proven many times over that the second the Government gets involved, it can create a larger mess. I suppose you could make the argument of its similarities of the separation of Church and State...Enter the small business person and entrepreneur, who may just save the world!!!
Thanks for reading! More tomorrow!
Ed Martin
Showcase Properties Unlimited
303-875-4450
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