Freddie Mac calling for some USD 13.8 Billion from US-Government
According to dpa Freddie Mac is going to offset its Q32008 loss of USD 25.3 Billion by having the government step in.Again the reason for the heavy depreciation is mismanagement related to the financial crisis originally caused by the increase of the fed funds' interest rate impacting the real estate as well as the credit market.
The highest charge stems from a USD 14.3 Billion write off on tax allowances set up as an asset so far.
Equation:
write off tax allowances = decrease of equity = cashinjection = increase of equity
Taking a closer look at the bookings Freddie Mac just is juggling assets up and down; illiquid tax allowances become very liquid cash.
copyright Thomas Ramseyer
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