Fannie, Freddie: Unlimited Fail
December 25th, 2009
Change
Via: Reuters:
The Obama administration pledged on Thursday to back beleaguered mortgage finance giants Fannie Mae and Freddie Mac no matter how big their losses may be in the next three years.
It also jettisoned a demand that the two companies cut the size of their mortgage-related investment portfolios next year, allowing them to provide even more support in the near term for a housing market recovering from its worst slump in decades.
The Treasury Department said it made the changes to assure financial markets it stood firmly behind both companies and to buy more time for the two government-sponsored enterprises to whittle down their mortgage-related holdings.
The two agencies each had a Treasury credit line of $200 billion. Combined, they have so far tapped about $111 billion.
The Treasury’s announcement came just hours after the companies said their chief executives would be paid up to $6 million on an annualized basis for 2009.
