The explanation is too wonky for even WC to attempt, but the next time you are at a party and someone blames the Great Recession on Fannie Mae and Freddie Mac, tell them they are simply wrong. And make them read this article if they disagree.
If they don’t read it, you win the argument by default. If they do read it, they’ll likely fall asleep and you’ll still win by default. If they manage to stay awake and understand it, they’ll be as angry about two years of lies as WC is.
The simple truth is that the default rates for Freddie Mac and Fannie Mae loans are about a third of private sub-prime loans.
WC tries to keep up with the neocon lies, but it’s just not possible.