Tortured logic

"Remember, both Fannie and Freddie were solvent at the time of the August 2008 takeover, notwithstanding their previous run of losses. If the United States is allowed by fiat to throw solvent firms into government receivership, the Treasury's tortured logic would routinely allow the government to force any profitable corporation into receivership, thereafter to force a one-sided renegotiation of contracts that offers it huge dividends on nonexistent investments."

Richard A. Epstein


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