Headed South ...

When Freddie Mac and Fannie Mae were taken into custody, I held out some hope that the government's goal was to shepherd them back to solvency ... but it turns out they're doing a better job of destroying the companies than the corporate executives that ran them into the ground to begin with.

The Federal Housing Finance Agency, which placed the two companies in conservatorship on Sept. 7, directed them last month to start increasing their purchases of loans and mortgage-backed securities as the Treasury seeks to absorb underperforming and illiquid assets from financial companies.

Federal regulators directed Fannie Mae and Freddie Mac to start purchasing $40 billion a month of underperforming mortgage bonds ... Each company needs to buy $20 billion a month in mostly subprime, Alt-A and non-performing prime mortgage securities, according to the people, who asked not to be identified because the plans are confidential.

When patients, already sick, are being fed poison pills by the doctor they turn to for healing, there's virtually no hope of recovery. But then, considering what Bernake and Paulson are doing to the nation's economy at large, is there any safe harbor?