Economic Fascism Update: Fannie and Freddie on Borrowed Time

Barron's reports:

Even after their financial collapse and massive taxpayer-funded bailout, Fannie Mae and Freddie Mac are still the colossi of the U.S. home-mortgage market. They own or guarantee repayment on more than half of the system's $10 trillion in outstanding mortgage debt. More astonishing, these agencies are making money again -- lots of it -- under tightened government supervision and aided by strengthening home prices. Once their second-quarter numbers are released, they will show that the duo will have returned in dividends about $131 billion of the $187 billion that the government had to infuse into them following their September 2008 seizure. The recent news from the two has been so encouraging that their delisted common shares are up about 500%; the price of their preferred stock has gained about 200%, as opportunistic hedge and mutual funds wager that the two will survive -- albeit heavily reorganized and privatized -- and eventually offer the kinds of big share payouts that investors reaped from American International Group (ticker: AIG), among other casualties of the financial crisis.

It's time to separate housing from state.