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US Treasury Rejects Bid From Goldman For Fannie Mae’s Tax Credits

By AgentImage, Saturday, November 07, 2009
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The billion dollar question is “what is best for the US tax payers”… ask people in Washington and you’ll get a completely different answer than if you asked people on Wall Street. Either way, the Obama administration rejected Goldman Sachs’s offer on Friday to buy as much as $1billion in tax credits from Fannie Mae. The bottom line is Treasury officials said ” It is our view that the proposed sale would result in a loss of aggregate tax revenues that would be greater tahn the savings”. Period end of story! While Goldman argued that the capital could have been used by Fannie Mae to finance low-income housing and bring some relief to the bleeding,, it wasn’t enough.

Just the day before, Fannie announced a loss of $19B in the 3rd Q and expected to ask for another $15B from the US Government.