My parents have money (in excess of 100K by a bunch) that is "collateralized" through the Federal Home Loan Bank in Chicago, which is backed by Fannie Mae securities. Is this safe?
Although we aren't familiar with the underlying investment that you have described as collateralized by the FNMA securities, your concern seems to be about the risk, if any, in the FNMA paper. It's likely that the securities in question are bonds and other debt obligations of FNMA, rather than stock in the company. Those debt obligations are still fairly safe investments, because there is an implicit government guarantee behind them. There is simply too much riding on both FNMA and FHLMC as vehicles in the home mortgage market for the government to permit either of those entities to fail.
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My parents have money (in excess of 100K by a bunch) that is "collateralized" through the Federal Home Loan Bank in Chicago, which is backed by Fannie Mae securities. Is this safe?
Although we aren't familiar with the underlying investment that you have described as collateralized by the FNMA securities, your concern seems to be about the risk, if any, in the FNMA paper. It's likely that the securities in question are bonds and other debt obligations of FNMA, rather than stock in the company. Those debt obligations are still fairly safe investments, because there is an implicit government guarantee behind them. There is simply too much riding on both FNMA and FHLMC as vehicles in the home 