Paulson says changes needed at Fannie, Freddie

[Terri]

By MARTIN CRUTSINGER
Associated Press
January 8, 2009

WASHINGTON (AP) -- Treasury Secretary Henry Paulson on Wednesday said the best option for the future of Fannie Mae and Freddie Mac could be for the mortgage giants to be run like public utilities.

In what could be his last speech as Treasury secretary, Paulson said that allowing the two companies to return to their previous operating approach was not an option.

Fannie Mae and Freddie Mac were taken over by the government in September and placed in a conservatorship after mounting mortgage losses put them in operating distress that was a prelude to the broader financial crisis that hit Wall Street last year.

Under Paulson's proposal, Congress would replace Fannie and Freddie with one or two private sector entities that would purchase and securitize mortgages with a credit guarantee backed by the federal government. The new companies would be privately owned but governed by a rate-setting commission that would establish a targeted rate of return, he said.

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[welder4]

Well they certainly can't return to loaning money to people who do not have jobs or means to pay the loan back. What got them in trouble was congress and the Carter and the Clinton administrations so we are going to let the same people that caused this to bring it out of failure? We must be either brain dead or non caring what happens with our tax dollars , the bail out for the auto companies makes more sense then the bailing out of the banks, after all the four dollar gas was what caused the auto melt down, it even effected the God of America , Toyota. What has happened to us as a country? we don't care to buy American made any more and we are not in the 70's so wake up to the fact that if we have no manufacturing base left we are headed for a sorry economy for sure. The reason that the stimulus checks do not help is because the money goes straight to China where the traitors are that used to build the products here.

[utexas]

In my opinion, these quasi-governmental bureaucracies never should have been incorporated in the first place. If it was up to me, I would permanently put them out of business before they cause any more damage to the economy or the federal deficit.

Can anybody say ‘Socialism?’

[Cynical Pete]

"Paulson says changes needed at Fannie, Freddie"
No Kidding?