Straight Talk: Artful Deflection

      Two government moves last September sent the economy into a tailspin.

      The first move was placing Fannie Mae and Freddie Mac into conservatorship on Sept. 7. The government pumped equity into the deteriorating GSEs by purchasing senior preferred shares, coming ahead of existing preferred and common shareholders. This was a particularly stinging blow to the investment community because up until then, Treasury and bank regulators had encouraged the purchase of Fannie and Freddie equity. Sixteen billion dollars in stock held . . .

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