Freddie’s Charm Offensive

That these ads appear over a story regarding a bailout is ironic. When you click on the ads, they take you to a web page with a “statement by Freddie Mac.” The statement is full of jargon that suggests the company remains strong, that it has “substantial capital” over its regulator’s “statutory minimum.” The statement concludes with Freddie’s tagline, which you can also see in the second ad: that the company “makes home possible.”

Nonsense. Taxpayers make home possible by guaranteeing Freddie’s debt. That guarantee allows Freddie to borrow at substantially lower rates than it otherwise could, pumping billions of excess capital into home mortgages.