Jul 29, 2008

Bill Fleckenstein on the government's efforts to rescue Fannie Mae and Freddie Mac

The government's efforts will not create a bottom for financial stocks because of the fundamental problem in this country: People carry too much debt against homes that are sinking in value, homes they really couldn't afford in the first place and homes that have become all the more burdensome due to the inflation that's ravaging their paychecks. That the implosion of the housing debt bubble is dragging the economy down with it will just put additional pressure on jobs and the ability to service housing debt.

~ Bill Fleckenstein, "The Repugnant Bailout Nation," Contrarian Chronicles, MSN.Money, July 28, 2008

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