In the 1969 movie Bob & Carol & Ted & Alice we were treated to liberal-minded baby boomers exploring their feelings and sexual limitations. Fast forward 40 years and little has changed. Only now the liberals refuse to pull away the bedsheets because they don't want anyone to see the terrible cost of 30 years of clueless experimentation.

When President Obama signed the financial reform bill recently, Chris Dodd and Barney Frank were right by his side, but not a word was said about Fannie Mae and Freddie Mac.

"Fan and Fred could end up costing taxpayers more than $5 trillion," says Lee Troxler, author of the new blockbuster "Killing Wealth, Freeing Wealth." "Fan and Fred are a far larger problem than the chicanery we saw on Wall Street. And yet there was hardly a single sentence devoted to them in the 2,000-plus page financial-reform bill."

"Democrats in Washington are unwilling to yank away the bedsheets on the financial scandal that they caused," adds Floyd Brown, co-author of "Killing Wealth, Freeing Wealth." "While many of the bankers have been paying back the money we taxpayers gave them, Fan and Fred continue to bleed red just the way the Democrats want it."

In their book, authors Troxler and Brown revealed just how  dirty the Democrats and their "Killionaire" bedmates really are ...

During the 1990s boom times, Fannie and Freddie became darlings of Wall Street for two reasons. One, they posted steady earnings. Two, they came with implicit guarantees that if anything ever went wrong, Washington would ride to the rescue. As an investor, it's hard to top that one-two combo. If you invested in Fannie in 1995, you were up 400% by 2001. Your investment in Freddie was up 500% by 2004. But not everything was on the up and up.

In June 2003, auditors were doing a routine review of the finances of Fannie and Freddie when they uncovered certain "accounting irregularities." A small panic rippled across Washington and made its way into the Oval Office. Wasting no time, President Bush put Fannie and Freddie under Treasury Department oversight and ordered them to behave responsibly. Presumably that meant stop with the inflated earnings, the overpaid executives, and the risk-taking with other people's money. But if the president was serious in his admonitions, none of his subordinates were. Months passed without any corrective action being taken. Soon reports of irregularities were upgraded to evidence of "extensive financial fraud."

Turns out that Fannie's chairman, Franklin Raines, had been cooking the books to help himself to an estimated $90 million in bonuses during his tenure. His accomplice in the scam? None other than Goldman Sachs, headed at the time by Henry Paulson who would go on, years later, to run the Treasury Department and engineer the 2008 bailout of all his Wall Street friends. But we're getting ahead of the story.

Despite clear proof of scandal so monstrous and damaging to the nation it made Watergate look like child's play and Teapot Dome a college prank, nothing happened. Trillions of dollars of home equity was in jeopardy because of bad dealings at Fannie and Freddie, but the principles walked with hardly a wrist slap. How could that have happened?

Was it because Fannie Mae Chairman Mr. Raines was an old pro at gaming the system? Was it because he had been the budget director under President Clinton? This isn't rocket science.

In any case, Mr. Raines had played a central role in the asset-stripping of America. And he was unrepentant. He wasn't about to give it back. He started calling in favors. He got plenty of help in his fight from a woman who had been vice chairman at Fannie Mae, Jamie Gorelick. She had previously served as deputy attorney general under Mr. Clinton, and was connected. (An aside: Ms. Gorelick was also the person most responsible for sabotaging U.S. intelligence agency efforts to stop 9/11, as documented in the movie FahrenHYPE 9/11).

With Ms. Gorelick and Mr. Raines calling in chits across Washington, and because the White House was taking a powder, the cover-up was soon complete. To put a bow on it, the senior Democrat on the House Financial Services Committee, Barney Frank, trotted out before the cameras and, guileless as a schoolboy, announced: "These two entities – Fannie Mae and Freddie Mac – are not facing any kind of financial crisis. The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing."

As Democrats lined up to hide their culpability in the biggest financial disaster in American history, the housing crisis deepened. It was just as the ?Killionaires' wished. All part of the plan. The more people bought homes they couldn't afford, the more chaos bottled for later exploitation.

And a lot of homeowners were in over their heads.

By the time the housing market collapsed, 56% of Fannie's and Freddie's home loans had gone to folks with below-average incomes, 27% of their loans had gone to folks who couldn't afford rent much less a mortgage, and 35% of their loans had gone to folks in the "underserved areas" (read: wherever the Democrats needed to buy more votes to win). The results?

Back when the housing bubble was but a gleam in the Killionaires' eyes, circa 1994, only about 4 percent of all home mortgages were subprime, with 31 percent of those subprime loans being turned into securities. By 2006, just over 20 percent of the mortgage market was subprime and 81 percent of those loans had been turned into now toxic securities. Former Sen. Phil Gramm noted: "If this crisis proves nothing else, it proves you cannot help people by lending them more money than they can pay back."

While true, his comments were but official window dressing. What the crisis proved, in our view, was that the Killionaires were prepared to go to incredible lengths to undermine the economy and amass their criminal fortunes.

All of this information has been made public by Brown & Troxler, and other diligent researchers. But it hasn't changed a thing in official Washington.

"The Democratic leadership knows that their key constituencies are either committed to the team – right or wrong," says Lee Troxler, "or they're dumb as cement. So the Democrats are free to continue flogging the official version of the financial crisis as greedy bankers taking stupid risks, instead of the truth that those bankers were only doing what Washington let them do and the biggest problem of all was entirely of Washington's own making."

For their part, Chris Dodd and Barney Frank now say they'll get around to changing the bedsheets ... after the election. Why then?

Because to deal with the Fan and Fred problem would require forcing millions of people who can't afford their homes out onto the street. "Not going to happen while Democrats are running things," says Floyd Brown, "because most of those freeloaders who got into houses they can't afford ... vote Democrat."

Floyd Brown & Lee Troxler are among the few authors who correctly identified the true causes of the financial collapse, but who also offer entrepreneur investors a gameplan for the rocky times ahead. Their book "Killing Wealth, Freeing Wealth," is available on discount from WND today.

Click Here to Get "Killing Wealth, Freeing Wealth" Now!

 

Call Toll-Free to Order:  If you prefer to order by phone, you can call our friendly, Midwestern customer service reps toll-free at 1-800-4WND-COM  (1-800-496-3266), Monday-Friday, 9am-5pm Central.

You may also enjoy these items ...