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July 11, 2008
U.S. Weighs Takeover Plan for Two Mortgage Giants
With Fannie Mae and Freddie Mac's shares down 30 percent and 45 percent, respectively, in a week's time, senior Bush administration officials have initiated discussions about what do in the event that one or both of the government-sponsored enterprises fails. Although they insist the GSEs are well capitalized for the time being and a crisis is not imminent, there is talk that the government could take control of one or both of them and put them under a conservatorship--which would erode their stock values and make taxpayers responsible for losses--if necessary.
Posted by S. Germain at July 11, 2008 08:08 AM