In a way, the situation is ironic: housing was at the root of the financial crisis, and six years after the meltdown, housing finance is still the greatest unsolved issue. TheU.S. housing market is roughly $10 trillion, making it one of the largest segments of the bond market. Roughly 70 percent of the American population has a mortgage, and for most people, the mortgage is the most important financial instrument in their lives. But until the financial crisis, few people knew the essential role that Fannie Mae and Freddie Mac play in their mortgages. Given the $188 billion government bailout of the two firms - the most expensive bailout in history - the politics surrounding housing are worse than they've ever been, and the two gigantic firms sit in limbo. Best-selling investigative journalist Bethany McLean, the coauthor of The Smartest Guys in the Room and All the Devils Are Here, explains why the situation is dangerous and unsustainable, and proposes a few solutions - from the perfect, but politically unfeasible to the doable, but ugly.
"Bethany McLean has written an insightful guide to one of the fascinating true-financial-crime cases of our time."
The Washington Post
"In a short, lucid paperback (or e-book) from a new publishing arm of Columbia University, McLean explains how the topsy-turvy world of Fannie and Freddie came to be and why government control of them likely will limp along indefinitely as the major unresolved issue of the financial crisis."
USA Today
"An excellent new book that attempts to make sense of the senseless history of Fannie and Freddie."
