How the Consumer Price Index Can Help You
The Treasury is not the only government agency that issues debt. There are a host of government agency and quasi-agencies (agencies created by an act of Congress, like FNMA) out there borrowing money. Following are some of them:
· The Federal National Mortgage Association (known as "Fannie Mae"). FNMA is a quasi-agency. Its debt is an implied (but not a guaranteed) obligation of the federal government. The agency's stock trades publicly on the New York Stock Exchange under the ticker symbol FNM.
· Federal Home Loan Mortgage Corp. ("Freddie Mac"). Like Fannie Mae, Freddie Mac is a quasi-agency/private corporation with stock listed on the New York Stock Exchange under the ticker symbol FRE.
· Student Loan Marketing Association ("Sallie Mae"). Officially known as SLM Corporation, Sallie Mae is the third and last of the three public/private corporations. Its ticker symbol is SLM.
· Government National Mortgage Association ("Ginnie Mae") issues bonds that return both principal and interest, just as you pay your monthly mortgage in a single sum to cover both principal and interest. GNMAs are federally guaranteed. This is the only quasi-agency that enjoys this privilege. "Ginnie Mae" bonds are an example of a class of bonds called mortgage-backed securities (MBS). The MBS is a debt instrument with a pool of real estate loans (perhaps your mortgage included) representing the underlying collateral. As principal and interest payments are paid into the pool, they, in turn, are paid out to GNMA bondholders. Mortgage-backed certificates are issued by banks and insured by private mortgage insurance companies.
· Resolution Funding Corporation (RFC). These bonds are guaranteed as to principal, but not interest, and were issued to help resolve the Savings & Loan crisis of the late 1980s/early 1990s.
Mark Crisp is the author of "How I Made $6 Million in the Stock Market" Prepare to be shocked at how big money is really made on Wall Street.
http://www.sixmillionstocks.com
Source: www.articlecity.com
