The government pledged to inject taxpayer dollars into the companies to prevent insolvency — up to $100 billion total for each company. It also will also start buying mortgage-backed securities from the companies.
The stocks of the respective companies have plunged over the past year, losing over 90% of their value. Fannie Mae was trading at 62.76 on 9/10/2007 and Freddie Mac was trading at 58.75 on the same date. Fannie Mae closed at 0.730 and Freddie Mac closed at 0.880.
Banks make terrible neighbors, and resulting suburban blight is likely to give positive feedback to already hurting home values. In short, suburbia is dying. Depending on energy prices and future technology, it could be a terminal case for millions of Americans.