Fannie Mae, Freddie Mac Wind Down Means 100% Loss For Stakeholders

Although Fannie Mae / Federal National Mortgage Association (OTCBB:FNMA) and Freddie Mac / Federal Home Loan Mortgage Corp (OTCBB:FMCC) have paid back the $188 billion that they owed the government, their sins have not been absolved yet. Unsurprisingly, Fannie Mae's former CFO, Timothy Howard, blames the treasury and the regulators for the fall of the mortgage giants during the financial crisis.

In his latest book, Howard calls the bi-partisan plan for liquidation of the GSEs, "a recipe for disaster". He says that the amount of risk taken by the GSEs would never be possible if they were not backed by the government anymore. Dick Bove, who has weighed in on the Fannie Mae/ Freddie Mac debate several...