Fannie Mae Changing Accounting Practices to Conceal Losses

Fannie Mae has changed the way it computes credit loss ratio, a measure of the quality of its loans.

Bigger numbers are bad, and under the new scheme, the number is 4 basis points, but under the old scheme, it would have been 7½ basis points.

I believe that Fannie is the 2^nd biggest issuer of debt in the world, and the fact that the quality of their loan portfolio is almost twice as bad as their numbers suggest is scary.