Fannie Mae’s Conservatorship: A Babysitter’s Blunder
What the general public doesn’t understand is that Fannie Mae has been under conservatorship since the 2008 market crash — a status far from ideal, just one step from bankruptcy. By definition, a conservatorship is a legal arrangement where a court appoints a conservator to manage the affairs of an entity unable to do so itself, due to financial distress or other incapacity. It’s a polite term for babysitting an organization that can’t handle its own affairs.
A Babysitter Who Sparks Chaos
Calling the Federal Housing Finance Agency (FHFA) a babysitter for Fannie Mae doesn’t fully capture the dysfunction. It’s more like hiring a babysitter who dumps a five-pound bag of Skittles in the kid’s lap, hands them a pack of matches for “entertainment,” and then congratulates themselves for creating a “structured environment.” Instead of guiding Fannie Mae toward independence, the FHFA has fueled a sugar-charged, fire-hazard meltdown, acting shocked when stability remains elusive.
For over a decade, the FHFA has perfected the art of doing the bare minimum, dodging tough decisions, and pretending this was all part of a master plan—while busy watching TikTok videos and plowing through Red Bulls like it’s the last 4-pack they’re gonna make. Calling them “inept” feels almost too kind, like praising the babysitter for “creative problem-solving” when the living room is literally on fire.
This situation deserves public scrutiny—a 60 Minutes special report would be a start—to expose the mismanagement. The prolonged conservatorship has left Fannie Mae in a precarious state, and greater awareness could push stakeholders, potentially with Pulte’s involvement, to address this critical issue.
With the Appraisal Regulation Compliance Council (ARCC) now involved, the potential restructuring of the Consumer Financial Protection Bureau (CFPB), and Pulte leading the FHFA, there’s a glimmer of hope. Maybe—just maybe—we can start moving toward a sane approach to funding and home valuation without burning down the house, so to speak.
This article, adapted from a comment on AppraisersBlogs, offers a sharp critique of Fannie Mae’s conservatorship. We’ve refined the text for clarity and flow while preserving its original insight and wit. We thank the author for their compelling perspective, which inspired this article and sparks an important conversation we hope our readers will continue.
Great opinion piece. You nailed it — the so-called ‘babysitters’ let Fannie and Freddie rot under the weight of political agendas and bureaucratic nonsense. It’s amazing how a conservatorship meant to stabilize the market turned into a long-term power grab. Hopefully, someone finally wakes up and puts an end to this disaster before more damage is done. Thanks for shedding light on what too many (APPRAISERS) are happy to ignore.
Skittles and matches! Too funny. So true.
Have they even paid back any of the principle ($116 Billion) to us tax payers after what 17 years? GSE: Government Subsidized Enterprises sounds more truthful!