Stiglitz & Fannie Mae, continued…  Last week I expressed some
disappointment that while Nobel prize winner Joseph Stiglitz now
raises the issue of “privatized gains and socialized losses” in
our financial system, he made very different claims about Fannie
Mae some years ago.  In a NPR piece back in July, Professor
Stiglitz offers his response to this charge.  You should read it
and decide for yourself.  To the Professor’s credit, he does
admit that we have a problem with Fannie (and Freddie).  Such an
admission would have been more helpful a few years ago.  But
better late than never.  For the sake of brevity I will address
one of the many claims now, and address the others later this
week.  Stiglitz argues that “our big banks get finance at lower
rates of interest than do others, because of the belief, in
part, that should they have a problem, they will be bailed
out.”  His implication is that had Fannie not existed the risk
would have just flowed to the big banks, who had to be bailed
out too.  Now I’ve que