A GSE filing bankruptcy? I don't think so.. this would have broad implications for the stability of the markets. The current model with the government owning 79.9% of common will likely stay. Leverage works both ways.. 3 years of backstopping should be sufficient - If the government is successful in inflating their way out of this economic crisis within 3 years, FRE/FNM will come roaring back. Once FRE/FNM and the housing market is on more solid ground, structural changes are more likely.
A GSE filing for bankruptcy is a very unlikely scenario.
This is NOT Social Security or Medicaid....Come to think about it, they are flirting with bankruptcy as well. Since they are NOT publicly traded YET,there is nothing to be gained by officially declaring them bankrupt. Government still holds the entire bag on those. Not so with these two! There is plenty for the government to gain by the flick of a pen..