Freddie Mac Is Not Doing Well

In fact, it's doing horribly, at least according to Gretchen Morgenson. And she backs up her assertions quite well. Delinquencies are way up. The number of foreclosed properties Freddie holds has almost doubled over the past year. Q1 loss is $6.7 billion. They want another $10.6 billion from us.

Freddie says the basic problem is it had to move some things onto its balance sheet, the things being its guarantees on weak mortgages. This amounted to over $1 trillion. Not chump change.

Morgenson and others agree that moving things to the balance sheet had a major impact on profitability, but they question whether Freddie is paying too much for some mortgages. They go further and speculate that the administration is using Freddie as a back door means of helping the banks. The silence about Freddie's numbers certainly does give one pause.