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Government Sponsered Entities

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stefan olafson

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Government Sponsored Enterprises carry an implicit guarantee. This means that the federal government acknowledges an interest in the issuing organization and thus implies an interest in the securities it issues. This differs from the explicit guarantee for U.S. Treasury securities, which states that the securities are backed by the full faith and credit of the U.S. government. While an implied guarantee is not considered as safe as an explicit guarantee, the government historically has taken action if the financial status of a GSE appears threatened.
• The government also grants special privileges to GSEs, designed to help ensure the organizations' financial strength. This includes access to large credit lines from the Treasury, typically between $1.0 billion and $4.0 billion, and important exemptions from tax and securities laws.
• The government has the power to regulate GSEs in various ways, including, in some cases, the power to appoint directors to an organization's board.


My question is; if Fannie Mae and Freddie Mac are now part and parcel of the federal government, are they still considered GSE's?
 

VolcanoLvr

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I'm not a legal beagle, but in my opinion the are still considered GSE's....only now they are being operated by a conservator approved by congress, with a new oversight organization they report to.

They are a hybrid organization....a bit of gov't and a bit of private, rolled into one.

They were created by congress to be separate 'agencies', not by a provision in our Consititution which defines the three branches of gov't. Therefore, they are not 'part and parcel' of our fed. gov't.
 

Terrel L. Shields

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Arkansas
bit of gov't and a bit of private, rolled into one.
when they make money they are private and benefit the stockholders. When they lose money they are the burden of the taxpayer...nice, really nice.
 

Howard Klahr

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They were created by congress to be separate 'agencies', not by a provision in our Consititution which defines the three branches of gov't. Therefore, they are not 'part and parcel' of our fed. gov't.

Where is the Treasury noted in the constitution? The Dept of Transportation? HUD? etc. Are these not 'part and parcel' of our Federal government?

Having a provision in the constitution is not a requirement to be part of the government.
 

Mztk1

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And the FBI and CIA are certainly not explicitly in our constitution.

Fannie & Freddie are now government agencies. Fannie was a government agency from its New Deal era birth until 1968 or so. Nearly immediately after privatizing it Freddie had to be created as competition (early 70s). My personal opinion is we should have left it as government from the start. I simply don't agree with the hardcore right wing that government is always bad, especially when that government is We the People.
 

AnonApprsr

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Where is the Treasury noted in the constitution? The Dept of Transportation? HUD? etc. Are these not 'part and parcel' of our Federal government?

Having a provision in the constitution is not a requirement to be part of the government.
Yeah, and where does it say I have to pay federal taxes?! :new_multi:
 

Mikyl

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Anon,

The 16th amendment established the payment of income taxes. There is debate on the definition of "income", but the short answer is the 16th amendment.
 

AnonApprsr

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Anon,

The 16th amendment established the payment of income taxes. There is debate on the definition of "income", but the short answer is the 16th amendment.
Are you sure?
 

JRS at OBX

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North Carolina
Yes, although it was never ratified by a majority of the sovereign states.
 
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