It’s been 10 years since the fateful unwinding of my former company, Freddie Mac. That once proud Fortune 50 company, along with Fannie Mae, had been the backbone of the country’s housing finance system.
In many ways, it still is.
But its broken back has never been fixed: for 10 years, the two firms have been doing their job buying and securitizing mortgages propped up on a comfortable bed known as government support.
Allow me to take you back — to the hot angry summer of 2008 when market panic rose with every new indication that the tsunami of mortgages losses that was flooding Main Street was about to flood Wall Street as well. How could we employees at Freddie Mac — I was a vice president — not have known that the end was so near?
Over the next two weeks, I will be sharing excerpts from my book, Days of Slaughter, Inside the Fall of Freddie Mac and Why It Could Happen Again (Johns Hopkins University Press, 2017). I’ll also provide some reflection on where things stand today reform-wise.
Maybe some memory jogging will help remind Americans what happened to them — and the “greatest housing finance system in the world.”
And maybe it will get policymakers off the duff.