Freddie Bleeds U.S. Dry
Oh man! Just when we thought the nightmare was finally over, he comes clawing back to terrorize our dreams.
No, not Freddy Krueger on Elm Street. We're clearly talking about Freddie Mac (FMCC.OB) on Wall Street.
Government controlled mortgage buyer Freddie Mac went back to the well Monday, asking for $1.8 billion in additional federal aid after it posted a larger than expected second-quarter loss. Freddie, the second largest provider of funding for U.S. residential mortgages behind sibling Fannie Mae (FNMA.OB), said it lost $6 billion in the April-to-June period compared to a loss of $840 million in the same quarter last year.It gets scarier too, with red ink flying across Washington like fake blood in a slasher flick. A frightening $1.3 billion of the losses were due to the company's 10% annual dividend payment to the Treasury Department on money it borrowed from Uncle Sam. "We recognize that high unemployment and other factors still pose very real challenges for the housing market," CEO Charles Haldeman said in a statement. "With that in mind, we continue to focus on the quality of the new business we are adding to our book to be responsible stewards of taxpayer funds." Oh spare us. Freddie, Fannie and the U.S. government just keep digging the hole deeper and deeper, all the way down to China so they can beg for more money. Once our Asian bankers tire of seeing the same old movie, however, the real horror show will begin. And that's what's really got us shaking in our seats. Dumb-o-meter score: 75 -- This whole thing just makes us want to Scream. And then Scream II. And then Scream III.