“The Blind Leading the Blind” should be the title for the attached article from the New York Times. Why? The explanation of that phrase: Uninformed and incompetent people leading others who are similarly incapable. The origin is from the Bible, Matthew 15:14 (King James Version) where it says: “Let them alone: they be blind leaders of the blind. And if the blind lead the blind, both shall fall into the ditch.”

The management of FNMA and Freddie Mac has only lost billions. The Fed is far more skillful. They are losing trillions. Not a funny joke. But the fact is, if the Fed couldn’t legally print money they would have gone bankrupt long ago.

What do we need now? Leadership by the Fed with a narrow-minded focus on one objective: The creation of civilian jobs. NO government money should be given to anyone that can’t show how many civilian jobs will be created, how it will create the civilian jobs, what are the benchmarks along the way, and what is the reporting system.

How desperate is the need to create jobs? The current administration is talking job creation numbers in the 2 to 4 million range. NetGain estimated that the added interest expense resulting from the recent increased federal deficit would require 7.5 million new jobs to get back to where we were. The additional deficits created from the stimulus plan and TARP bring that number closer to 10 million new jobs needed to bring us back to where we were.

Why is NetGain so concerned? As we have written and described many times in the past: Jobs are the driving force behind our economy, and the value of income properties.

Despite assurances that the takeover of Fannie Mae and Freddie Mac would be temporary, the giant mortgage companies will most likely never fully return to private hands, lawmakers and company executives are beginning to quietly acknowledge.

The possibility that these companies — which together touch over half of all mortgages in the United States — could remain under tight government control is shaping the broader debate over the future of the financial industry. The worry is that if the government cannot or will not extricate itself from Fannie and Freddie, it will face similar problems should it eventually nationalize some large banks.

Read full article: U.S. Likely to Keep the Reins on Fannie and Freddie