Fannie Mae and Freddie Mack Bailout in the morning?

[goodformeto]

From the bloomberg.com article:

Fannie, Freddie `Insolvent' After Losses, Poole Says

``Congress ought to recognize that these firms are insolvent, that it is allowing these firms to continue to exist as bastions of privilege, financed by the taxpayer,'' Poole, 71, who left the Fed in March, said in an interview."

Bloomberg.com: Worldwide
read the article and It may scare you.

I know a few others here have followed the housing crisis recently and didn't know if anyone else had some opinions on what may happen when everyone wakes up to this in the morning.

The collapse (or nationalization) of these two would essentially stop the credit market cold. Add it to the discrediting of the ratings agencies and we may have some very significant damage to the dollar here.

This would make the housing stupidity more expensive than the war if I'm not mistaken.