Crisis: Fears rise on trillion-dollar trouble for Fannie Mae and Freddie Mac

This could be catastrophic.

US mortgage giants Fannie Mae and Freddie Mac are facing growing pressure as fears intensify about a potential calamity at the firms, which underpin trillions of dollars in home loans.

On Thursday, Freddie Mac shares plunged 22 percent to eight dollars, and are down over 40 percent this week and 75 percent this year.

Fannie Mae sank 14 percent to 13.20 dollars, down 26 percent in the week and 64 percent for the year.

[...]One research note this week said the two firms may have to raise tens of billions of dollars in fresh capital under new accounting rules to offset massive losses in their home loan portfolios.

And predictably the free entreprisers are now calling for government intervention. Big business doesn't want government to intervene in the economy until they start having problems.

"The government has to step in and do something," said Friedman, Billings, Ramsey & Co. analyst Paul Miller.

[...]Testifying on Capitol Hill, Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke sought to calm investor jitters about the financial health of Fannie and Freddie, while urging Congress to give them new regulatory tools to better protect the country from economic and financial havoc if a major Wall Street firm were to fail.

[...]Bernanke defended the Fed's decision to provide about $29 billion in loan assistance in JPMorgan Chase & Co.'s takeover of Bear Stearns earlier this year, but said it "is not something I want to do again."

Despite Wall Street's questions about Fannie and Freddie, and concerns about other investment banks faltering, Congress has a full plate and is unlikely to give financial regulators new powers before the next administration takes over.

McCain Top Economic Advisor Calls Americans "Whiners"

Talking about out of touch. Former Senator Phil Gramm is McCain's top economic advisor. He believes America's economic problems are imaginary. McCain says he disagrees with his own adviser. How can McCain argue that he is fit to be President with such a schizophrenic campaign. This is pure incompetence, as well as being outrageous. And why hasn't Gramm been fired yet? Obama just got a gift from his principal opponent. This video reinforces the perception that McCain doesn't know much the economy.

McCain Squirms to Explain his Birth Control Vote

This might be the most laughable of McCain's many gaffes. He contorts trying explain the contradiction in his vote, which he can't remember. He doesn't recall voting to not allow insurances to pay for birth control, when it pays for viagra. And the fact that one of his top advisers supports the idea makes this priceless.

Backlash fears as Sudanese President faces Genocide Indictment

It is meaningless to indict a current ruler on crimes against humanity without moving to capture that individual. And why shouldn't Mugabe be indicted as well.

The UN is braced for a fierce backlash from the imminent indictment of the Sudanese president for genocide and crimes against humanity in Darfur.

Omar al-Bashir will become the first sitting head of state and the first Arab leader to be charged by the International Criminal Court (ICC), which celebrates the 10th anniversary of its founding charter on Thursday.

Diplomats say Luis Moreno-Ocampo, the international prosecutor, will seek an arrest warrant for Mr al-Bashir from ICC judges in the Hague on Monday.

Thousands of UN peacekeepers in Sudan have regrouped and received extra provisions in recent days in anticipation of a hostile Sudanese response to the prosecutor’s move.

[...]Sudan has repeatedly threatened retaliation for charges being levelled against its leader after the slaughter in Darfur was referred to the ICC by the UN Security Council in March 2005.

UN officials fear the indictment, which must be approved by ICC judges, could precipitate the collapse of the fragile UN force in Darfur, where some 300,000 people have died since government-backed Janjaweed Arab militias began driving villagers from their homes in 2003.