Monday, September 08, 2008

Dick and Dave and Dan and Herb, friend of John McCain

UpUpUpDate: Senator Barack Obama and two other prominent Democrats urged federal housing regulators on Tuesday to cut the golden parachutes of the ousted leaders of Fannie Mae and Freddie Mac, another sign that the government bailout of those mortgage giants could reverberate through the presidential campaign. E. Dash

UPUPdate: Payouts For Ousted CEOs Anger Shareholders 

UPDATE: Some are not left behind, according to NPR: Dan could get $9 million, Dick $14 million, in severance.

As the US Treasury Dept. sets forth on its experiment in nationalization of industry (introduced via Henry Paulson's hoary imitation of Greenspan), it's not easy to find a report of what the former capitalist heads of Fannie Mae and Freddie Mac will receive in acknowledgment of their services. (The $$ it took to make them go quietly).

Message From Dick Syron (WSJ)

To the Employees of Freddie Mac:

As you have probably heard, the Treasury Department announced today that it has placed Freddie Mac and Fannie Mae under the conservatorship of our regulator, the Federal Housing Finance Agency.

Under conservatorship, FHFA will assume direct control of both companies. FHFA has appointed David Moffett, former Vice Chairman and CFO of U.S. Bancorp, to succeed me as CEO. He will be joined by an equally strong non-executive Chairman, John Koskinen. I will retire and have offered to assist in the transition.


It has been a pleasure and an honor to work with all of you.



In December 2007, Syron told financial analysts that he expected Freddie Mac would incur heavy losses because of the weakening housing market and rising mortgage defaults. [1] Despite these forecasts, and concerns over the fiscal stability of Freddie Mac due to larger-than-expected write-offs, Syron reportedly took home over $19 million in cash, stocks, and other executive compensation in 2007. [2] Mr. Syron was terminated September 6, 2008, under a Federal Housing Finance Agency plan for conservatorship of Freddie Mac.

The new head of Freddie Mac is Dave:
David M. Moffett (1952) is the current CEO of Freddie Mac. He was previously an executive with U.S. Bancorp. He also served as senior advisor to the Carlyle Group, and has been a director at eBay since July 2007.
The new head of Fannie Mae is Herb (Allison), who replaces Dan:
On September 7, 2008, Mr. Allison was chosen to head the Federal National Mortgage Association, as part of an emergency federal conservatorship of the financial institution caused by the housing market crisis. The FNMA, often called Fannie Mae, is the financial institution created during the New Deal as a governmental financial institution, but that was subsequently privatized, that provides liquidity in the market for mortgages by guaranteeing consumer home mortgages.

In 2000, Mr. Allison accepted a leadership role in a start-up academic organization, the Alliance for Lifelong Learning, Inc., a joint venture of Oxford, Stanford and Yale Universities. There, as President and Chief Executive Officer, he ostensibly helped build an online learning forum for adults that provided the highest quality college-level courses. However, the Alliance for Lifelong Learning web site is now a misleading link farm and there is no obvious evidence of its still existing or ever fulfilling its stated mission. [Editor's note: Hopefully he'll have better luck with Fannie Mae].

LONG DISTANCE LEARNING, FURTHER EDUCATION TRAINING EDUCATION Education is a progressive discovery of our own ignorance

After leaving Merrill Lynch in mid-1999, he served as National Finance Chairman for U.S. Senator John McCain's Presidential Campaign.

Paulson spells it out, passes buck:
"...only Congress can address the inherent conflict of attempting to serve both shareholders and a public mission. The new Congress and the next Administration must decide what role government in general, and these entities in particular, should play in the housing market."

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