Fannie Mae's Institutional Arrogance

By Bill Mann

"The absolute brazenness of Fannie's actions is dumbfounding. It asked regulators for permission to account for its derivatives using its own method, was told no, and did it anyway. How did it think it could get away with this?
"The answer is arrogance, and the fact that Fannie Mae has such a powerful lobbying force in Washington. Politicians are terrified of the potential economic impact of challenging Fannie Mae's credibility -- there may be no more important financial institution in the country save the Federal Reserve.
"The best case for Fannie Mae at this point would be a management sweep, a capital raise, and some fierce new oversight and strictures on the company. The worst case is almost too awful to contemplate ..."

Fannie Mae dismisses CEO and CFO in response to critical report by SEC
By Robert Schroder
CBSMarketWatch.com
Tuesday, December 21, 2004