Guaranteed to Fail

Guaranteed to Fail: Fannie Mae, Freddie Mac, and the Debacle of Mortgage Finance


By Viral V. Acharya, Matthew Richardson, Stijn van Nieuwerburgh, and Lawrence J. White

Fannie Mae and Freddie Mac, the government sponsored enterprises (GSEs) designed to expand the dream of home ownership to millions of Americans, cost taxpayers $150 billion to date and growing as bad loans collapsed during the financial crisis.

Four NYU Stern professors ask “where is the outrage?” in running “the largest hedge fund on the planet,” in Guaranteed to Fail: Fannie, Mae, Freddie Mac, and the Debacle of Mortgage Finance. They propose a unique model of mortgage reform, using a novel public-private partnership as the means to transition to a fully private-based system.

Press coverage


Reckless Optimism (Book Review, Claremont Review of Books, Winter 2011/12)


How to Put an End to Fannie and Freddie (Author Opinion Editorial, Forbes, January 10, 2012)


Financial Economics (Book Review, Journal of Economic Literature, December 2011)


Costly creations (Book Review, Business Standard, October 20, 2011)


Why Fannie Mae and Freddie Mac need to diet (Book Review, The Economist, October 15, 2011)


The Downsides Of Mortgage Tax Breaks (Viral Acharya Interview, NPR, August 23, 2011)


Read more press coverage about Guaranteed to Fail


"...A down-to-earth analysis of why Fannie Mae and Freddie Mac collapsed..." --Nouriel Roubini, coauthor of Crisis Economics: A Crash Course in the Future of Finance

"...A comprehensive and well-written study..." --Raghuram G. Rajan, author of Fault Lines: How Hidden Fractures Still Threaten the World Economy

"...An excellent book... presents a cogent proposal..." --Dwight Jaffee, University of California, Berkeley

Read full text of endorsements

NYU Stern Faculty on Mortgage Reform

Other Voices on Mortgage Reform

Click a title below to download a specific proposal, or browse all proposals here.


NYU Stern Faculty on the Dodd-Frank Act

Regulating Wall Street

The NYU Stern authors of Guaranteed to Fail contributed also to Regulating Wall Street, a definitive analysis of The Dodd-Frank Act written by 40 Stern faculty.

Read more about Regulating Wall Street >>