Fannie and Freddie, hardball experts

by Frank James If you want to read a disturbing tale of how Fannie Mae and Freddie Mac used their clout in Washington to try to brush back their critics like pitchers throwing at the heads of batters, check out Paul Gigot's piece in The Wall Street Journal today. Gigot, editorial page editor of the Journal, recounts how he and the WSJ's editorial page found themselves on the receiving end of Fannie and Freddie's ire after they wrote some critical pieces about Fannie before that company's questionable accounting practices became widely known in 2003. My battles with Fan and Fred began with no great expectations. In late 2001, I got a tip that Fannie's derivatives accounting might be suspect. I asked Susan Lee to investigate, and the editorial she wrote in February 2002, "Fannie Mae Enron?", sent Fannie's shares down nearly 4%... [read full story]