Posted on 06/02/2009 2:44:34 PM PDT by NormsRevenge
NEW YORK (Reuters) – U.S. lawmakers on Wednesday will open a debate that has stymied them for at least a decade: the future of Fannie Mae and Freddie Mac, the giant housing finance agencies nearly felled by the credit crisis.
Congress is facing the daunting task of remaking the companies after steep mortgage losses led the Treasury in September to seize control of the two financing agencies. The stakes are high, with President Barack Obama counting on the reach of Fannie Mae and Freddie Mac to carry out his plans to improve housing affordability for nine million Americans.
Decisions made by Congress will affect the U.S. housing market for years to come. President Franklin Roosevelt's creation of Fannie Mae in 1938 to develop the mortgage market during the Great Depression helped standardize the 30-year fixed-rate mortgage in the United States and generate a massive expansion in homeownership -- to 66 percent in 2000 from 44 percent in 1940.
With the housing market now facing more than a 30 percent drop in home prices since 2006, and record foreclosures, the task of finding common ground between public roles and private enterprise will stretch into the next decade, analysts said.
What lawmakers and regulators agree is that Fannie Mae and Freddie Mac probably can't retain traditional models that long rewarded shareholders at the risk of taxpayers. Since their government takeover last year, Fannie Mae and Freddie Mac have already accepted $85 billion in taxpayer funds out of a pledged $400 billion.
All options will be considered in debate that has no expected timeframe for resolution, said Paul Kanjorski, the Pennsylvania Democrat who chairs the U.S. House subcommittee holding the hearing.
(Excerpt) Read more at news.yahoo.com ...
Any mention of Franklin raines, or how Obama and Chris Dodd were the biggest political recipients? Any mention of the Community activist thugs coming to bank offices to get fraudulent loans passed? Oh, right it’s CR-AP.
politicans are stupid. Let the house price to fall and it will be affordable for ppl to buy. Stop subsiding it
“All options will be considered in debate “
Except the option of privatizing or phasing out FM and FM. All options except the capitalist option.
Here is a hint, when your shareholders are completely wiped out and you are nationalized by the federal government, you've been felled. All the way.
It'd take half the planet. You aren't going to, nor is any private banker.
How can you ‘reform’ something without identifying the root cause.
Did they mentions Barney Frank and Chris Dodd yet?
If not, then they dont know the root cause
I bet when FM and FMac were created everyone said “Oh this is NOT going to be a big govt. program that interferes in the marketplace”
Just like Health Care
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