OMAHA, Neb.
Most rural bank CEOs surveyed in 11 Midwestern and Plains states support a federal bailout of mortgage lenders Fannie Mae and Freddie Mac in the event of financial collapse. But a new report released on July 17, says only about 11 percent of the bankers supported such an intervention for investment banks, such as Bear Stearns. Banks and other financial institutions are struggling to cope with billions of dollars of losses on bad mortgages. The Bush administration and the Federal Reserve announced on Sunday that they were putting together a support program for Fannie Mae and Freddie Mac to try to stave off serious troubles for the two mortgage giants which hold or guarantee more than $5 trillion of the nation's mortgages, almost half of the total. T h e o v e r a l l Ru r a l Mainstreet Index was at a weak 41. 4, up from June's 40.8, but down dramatically from 54.5 in July 2007. An index greater than 50 indicates a growing economy over the next three to six months. "Not only were current economic conditions weak in the rural agriculturally dependent areas, the confidence index, which gauges the bankers' outlook six months out, plunged to a record low 31.8," said Creighton University economist Ernie Goss. Goss and Bill McQuillan, CEO of City National Bank in Greeley, Neb., created the monthly economic survey of rural bank CEOs in 11 states: Colorado, Illinois, Iowa, Kansas, Minnesota, Missouri, Montana, Nebraska, North Dakota, South Dakota and Wyoming. The average community population covered by the survey is about 1,300. (AP)
