Call Fannie-Freddie Deal What It Is: A Seizure

Funny, isn't it, how a turn of the phrase or slip of the tongue can have such a subliminal effect on our understanding of a business event. Take this weekend's invitation sent by the government to Fannie Mae(FNM Quote) and Freddie Mac(FRE Quote) that they all join forces.

OK, so it wasn't quite an invitation.

Then again -- especially considering that shareholders will probably be left with nothing -- it wasn't quite a takeover, either.

It was more of a seizure.

I guess one man's takeover is another man's seizure. Though leave it to the business media, those contradictory little devils, to sometimes call it both in the same report. Actually, in the same headline.

Look at this neck cracker from CNNMoney.com. What is appropriately termed a seizure in the headline is downgraded to a takeover by the sub-headline: "U.S. seizes Fannie and Freddie: Treasury chief Paulson unveils historic government takeover of twin mortgage buyers. Top executives are out."

Good thing there wasn't a sub-sub-headline. By then, we probably would have read about that "invitation."

The business media, as The Business Press Maven never tires of pointing out, too often plays stenographer to authority -- whether that authority is a CEO or the government. And this is rarely more apparent than when reporters -- whether by simple choice or lazy default -- parrot the chosen, obfuscating, self-justifying phrases that authorities, who might do nothing else right, tend to always excel in.

The Financial Times did just that when remarking that Fannie and Freddie were going to be placed in a "conservatorship." Uh, dudes, they are being nationalized. A conservatorship is something you put a public garden in. Here, you and I are footing the bill on a whole lotta losses. What is it, more than $12 billion combined since last summer? I've run out of fingers and toes and have lost track.