What a marvelous choice to bail out a government corporation who created the secondary mortgage market (the market that essentially nationalized the mortgage industry). Why don’t politicians bail out more corporations? Clearly their business brilliance has saved the U.S. economy: bail out the companies who failed, contributed to the mess, and do nothing to change their practices. Makes sense. Why do we need these massive banks again? Oh right, because they’re politically connected.

Fannie Mae asked the U.S. government for an additional $8.4 billion in aid after posting an $11.5 billion net loss for the first quarter, the latest sign that the bailout of the mortgage investor and its main rival, Freddie Mac, is likely to be the most expensive legacy of the U.S. housing-market bust.

Fannie’s losses reflected continuing weakness in the housing market and would have been worse without accounting changes that reduced its deficit. The quarterly loss was an improvement from the $23.5 billion loss for the year-ago quarter and marked the 11th consecutive quarterly loss for the Washington-based firm.

http://online.wsj.com/article/SB10001424052748703880304575236030191182938.html

The effects on the environment from this oil spill should not be downplayed, but we should not overreact either. BP is going to pay the bulk of the expenses here, and it is no small amount. The company will survive, but people treat oil spills as the “downfall of capitalism” or something of that nature. There is absolutely no incentive for companies to want this to happen, yet many times environmentalists give the impression that companies want to ravage the environment in any way possible. Strong property rights ensure transparency, honesty, and resourcefulness. Of course, this event will likely result in more government regulation, more subsidies to energy sources politicians approve of, and yet another step back for the American people.

NEW YORK (MarketWatch) — BP on Monday disclosed $350 million in costs so far from its Gulf of Mexico oil leak, with the spill entering its 19th day since a giant oil rig sank and caused an estimated 5,000 barrels of oil a day to empty into the Gulf’s water.

Totaling up the estimated leak yields a figure of 95,000 barrels, or about 4 million gallons. By comparison, the 1989 Exxon Valdez accident spilled 10.8 million gallons into Alaska’s Prince William Sound.

After failing to cap the leak with a 100-ton containment dome, BP said Monday it will attempt to lower a smaller dome over the main leak point. The larger structure didn’t work because it became clogged with ice-like crystals as a result of cold temperatures and crushing ocean pressure a mile beneath the surface.

The oil major said such an operation has never been done at such a depth.

BP will also attempt a “top kill” option aimed at stopping the flow of oil from the well by injecting shredded rubber into the well as a stopper.

http://www.marketwatch.com/story/bp-spends-350-million-spill-no-end-in-sight-2010-05-10