Not my worry

August 5, 2008

We learned a couple of weeks ago that the Fannie and Freddie bailout might cost up to $25 billion. Now, this just in:

Remember, the government’s estimate of the cost to taxpayers for the S&L crisis rose from an initial $50 bn to more than $124.6 bn (not inflation adjusted).

More importantly, Congress spitballed that $25 bn number even though just this past month it sent in bureaucrats from the Federal Reserve and the Office of the Comptroller of the Currency to go find out what the heck is really sitting on Fannie and Freddie’s books, as it clearly doesn’t believe the management at these two levered up examples of crony capitalism.

The fear is, too, that the government may have to swallow these two obesities, causing the US dollar to plunge in anticipation of the need to mint more dollars, creating more inflation (not to mention the $99 tn in unfunded liabilities at Social Security and Medicare, according to Fed stats).

I confess to not following this story as closely as I should, and I find it hard to work up much outrage, despite the enormous sums of money involved and the further reach of government it represents. Want to know why? In June, I made my last house payment. That’s right — the LAST payment. Refinancing my house with a 15-year loan to replace the 30-year loan back when interest rates dropped dramatically was one of the smartest things I ever did. Now, I’m going to enjoy patting myself on the back for a few months. The rest of you worry about the housing crisis for a while, and I’ll get back to you real soon.

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