"Oh Doddy Boy, the banks, the banks are failing...."

Mortgage finance companies Fannie Mae, Freddie Mac sink on fears of government takeover

The magnitude of the subprime and Alt A exposure at the GSE's is now fully understood by the investors who realize that while Uncle Sam may do a bailout of the "too big to fail", the example set by Bear Stears is the holders of equity in the rescued firm end up with about a plugged nickel.

And the increasing velocity of the GSE's decline makes it very likely that this adminstration, and not the next one, will need to intervene and basically start to unwind much of the wishful thinking contained in the Dodd bailout bill.

Remember, it was Fannie Mae and Freddie Mac who were supposed to stand up and book the $300 billion in reworked subprime mortgages, with FHA mortgage insurance supposedly backing THAT up.  And Fan/Fred "profits" were going to fund "homeowner counseling" by the likes of ACORN, as well as an "affordable housing trust fund". http://online.wsj.com/article/SB121702734269186275.html?mod=opinion_main_commentaries

It now seems likely any GSE profits are going to be committed first to pay back the probable Fed financing that will be needed to keep the doors open and the real estate closing business afloat. You just can;t send a drowning man to the "deep end of the pool"

and where,pray tell is the architect of the 2008 Mortgage Bailout Bill?

The Senator who insisted   "that the firms known as Fannie Mae and Freddie Mac were “in sound situation” and “good shape,” and to suggest Fannie Mae and Freddie Mac were “in major trouble is not accurate.”
http://journalinquirer.com/articles/2008/07/16/connecticut/doc487b4ff58727c620830661.txt

Is Chris Dodd now around to tell us all to

"REMAIN CALM!!!!"????

Nope, as two of the nation's largest financial institutions approach a death spiral, where exactly IS Chairman Dodd?     

Hartford Courant columnist Kevin Rennie tried to find Dodd for belated answers about his sweetheart Countrywide mortgages http://www.courant.com/news/opinion/op_ed/hc-rennie0817.artaug17,0,7481730.column , and was told the Senator is at his vacation home in Ireland

Ahhh, the Ould Sod, the land of saints, scholars and runaway Senators. We'll see what blarney Chris brews up to explain his utter cluelessness this time, then again, he still hasn't explained why moving to Iowa in the middle of the subprime mortgage crisis last year and going AWOL from dealing with the worst financial crisis in decades was such a swell idea. http://www.washingtonpost.com/wp-n/content/article/2007/11/06/AR2007110602146.html 

"At the end of my tenure on this committee, I want it to be said that the safety and soundness of our financial institutions was not weakened on my watch," Dodd said.