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11/11/12 Update: DeMarco is only the Acting Director of the FHFA. He has been Acting Director since 2008. There is nothing controversial about Obama replacing Demarco. In fact it is irresponsible of Obama to not have nominate a permanent Director of the agency in the last 4 years.
Prior post”
Edward DeMarco is the head of the Federal Housing Finance Agency (FHFA), which oversees Fannie Mae and Freddie Mac after they went into recievership. Fannie and Freddie was caused to go into receivership by the same kind of financial shenanigans that is killing the Post Office. Fannie and Freddie were expanded during W’s tenure to buy on the secondary market all the bad sub-prime loans made by private crookslenders. (Just as the Post Office is being forced to pre-pay all of its pension funds for the next 50 years in 3 years time, so it can look like it is insolvent and should be privatized.)
DeMarco was appointed by W, and kept on by O, to oversee Fannie and Freddie. He believes he is a right-wing zealot, but he is actually an anarchist. He has described his job as protecting the taxpayer, but he seems to be unaware that homeowners are taxpayers, and that the wealth of all tax payers are tied to the value of the residential real estate market. (If he really cared about the taxpayer, he would have went after the corporate crooks who dumped all this toxic loans on Fannie and Freddie.) Instead DeMarco has refused to allow Fannie or Freddie to take part in any program that might help save homes from foreclosure, especially anything involving principal reduction. This nihilistic ideology caused him to refuse to allow Fannie or Freddie to take part in the recent $25 billion settlement with the banks which is saving homes at no cost to the government.
It recently came out that like Grover Norquist that DeMarco has been drowning in the bathtub any program that involved principal reduction before they had a chance to prove their value. Even programs recommended by the banks. Even principal forgiveness programs that were shown to ultimately cost the taxpaying public less money than foreclosing. Some of these programs were innovative by spreading the risk through Share Appreciation Programs (SAP). these programs would lop let’s say $100,000 off an underwater property in order to make it affordable and in line with its values. In exchange the homeowner would agree to share a potion of the appreciation (let’s say 20%) if they sell the home for a profit in the future. This is like what Bruce Willis did in Pulp Fiction. He worked for scale on the movie because he wanted to do the project which did not have the budget for his usual salary but he took a part of the reciepts if the movie was sucessful. The movie made a bundle, so did Bruce, and everyone was happy.
Demand DeMarco be fired immediately to stop him from wasting millions more of taxpayer dollars.
Filed under: Action Alert!, activism, economy, grassroots democracy, News, politics, social & economic justice, US Politics | Tagged: economy, Edward DeMrco, Fannie Mae, Federal Housing Finance Agency, FHFA, foreclosure, Freddie Mac, mortgage, Post Office, taxpayer | Leave a Comment »
