There is literally 0 functional difference. Fannie Mae and Freddie Mac are government sponsored entities. They buy conforming mortgages from banks, package them up into a mortgage-backed securities, and then sell them on the open market. The Fed buys these. So your claim that the Fed doesn’t buy mortgages because “ackshually Fannie Mae buys the mortgage” doesn’t hold much water. And in fact, the only real reason Fannie Mae can guarantee mortgages is because ultimately the Fed can step in to buy any distressed assets.

> literally 0 functional difference. Fannie Mae and Freddie Mac are government sponsored entities

Fed means Federal Reserve. Not the federal government. The Fed and federal government are meaningfully different.

The Fed is 'Governance'. It's just not democratic and didn't arrive into it's current situation the way we would have liked it.

It acts in essentially the same manner as 'Bank of England' or the 'ECB' just structured a bit differently.

The Fed's massive intervention in 2008 was similar to other Central Banks, because it's effectively the same thing i.e. 'governance'.

The Fed's intervention to 'buy mortgages' is not a 'market response' - it's a 'government response'.

The intervention was mostly related to buying mortgages (however they ares structured is secondary) and is de-facto a bailout of Home Owners, who, if they were subject to normal market conditions, would have faced massive foreclosures, and, would have destroyed home prices for everyone else, furthering the calamity.

That the mortgages on the Fed's Balance sheet were not 'the worst' of the assets is a bit of a side show - in 'current market terms' they were all toxic we know that because nobody wanted to buy them, which is why the Fed had to do a 'non market intervention'.

If they were not basically 'garbage' at the time, the Fed would not have had to intervene to buy them.

As a result, the Fed hold's a giant pile of 'mortgages'.

This comment is a good example of why popularly-controlled central banks fail within a generation. The lack of understanding is understandable. The insistence on doubling down on it is not.

Mortgage backed securities are mortgages.

> Mortgage backed securities are mortgages

In the way Sudafed is meth. Agency MBS’s never faced solvency questions. Unrated mortgage-backed securities and whole mortgages did. You are argued the Fed bought toxic crap off banks. It didn’t. It bought the cream of the crop, giving banks liquidity with which to address the rest.

The difference between mortgages and agency MBSs is entry-level finance. You don’t need to know it. But you should understand your circles of competence well enough to know not to debate it.