Well, friends, it finally happened. If you haven't heard by now, Uncle Sam has stepped in and adopted Fannie Mae and Freddie Mac. What does all of this mean to us as consumers? Home buyers? Home sellers? Tax payers?  Let me dust off my crystal ball and give you the low down...

Consumers: Initially on Monday, there appeared to be overwhelming approval and applause as evidenced by how the US & global stock markets rallyed. Since then, though, markets were down today due to dropping oil prices, Fed worries of a global economic slowdown, and intensifying concerns about Lehman Bros. Holdings Inc.'s ability to raise capital. Does anybody know why the prices at the pump seem to be creeping back up despite the drop in oil futures? Surely, it cannot be fear of hurricane Ike in the Gulf.

Home Buyers: More change is a comin' when seeking mortgage financing... Unless someone throws a "Hail Mary" pass and saves DPA (down-payment assistance) programs before the current Oct 1st, 2008, deadline, the doorway to home ownership for tens of thousands of homeowners will be slammed shut. Oh by the way, the minimum required down payment is also being increased from 3.0% to 3.5%. With this change, there goes a few more thousand potential home buyers whose bank accounts will come up short and will not qualify for financing (or must at least delay their home buying plans to raise the extra money for the down payment).

Home Sellers: Strap in and hang on - the ride is still a bumpy one. The bailout out of Freddie & Fannie will likely have long-term benefits; however, it will do little to help us out of the current troubles. The glut of soon-to-foreclose (short sale) homes and bank or Real-Estate-Owned (REO) homes presently on the market continues to adversely affect home values around the country and will likely continue to do so until the majority of the housing inventory is significantly reduced. Although I am an optimist by nature, most analysts and "experts" forecast that the earliest this could happen is late 2009 but more like mid-2010. For everyone's sake, I hope the market proves us all wrong - a turn-around by Christmas this year would be sweller than snow...

Tax Payers: Let me see, what was that magical formula? I think it's something like this:
Government involvement +  Inefficiency = Higher Operating Costs + Tax Increases. All I can say is get ready to pay - there is no free ride. Somebody's loss will not be the tax payer's gain.  ;-(