Bailout an important solution to our future

Recently, I wrote a letter into The Minnesota Daily about the current financial situation which pointed to why the $700 billion bailout should be passed, but also the reasons behind the financial crisis. This is important because it can lead to a solution that does not repeat the past. Key points to this was the Clinton administration giving affordable housing credit (government subsidies) for subprime loans, and that these loans were bought by Fannie Mae, and Freddie Mac, and then sold as government insured, making them âÄúAâÄù paper. Frank Raines, the chairman of Fannie Mae at the time, and Barack ObamaâÄôs current economic advisor, said that the investments were âÄúrisklessâÄù. Another key point to the solution is that the Sarbanes-Oxley act greatly regulated corporations, making CEOs responsible for financial reports coming out of their companies, but that Fannie Mae and Freddie Mac were not held to these stringent regulations. Without these key points we cannot come to our own conclusions on how to avoid this in the future. Winston Elliot University student