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IPFS News Link • Housing

Barney Frank Calls for Elimination of Fannie Mae & Freddie Mac in 2011

A hearing scheduled for next week before a Congressional subcommittee that could shed light on the future of the two lending giants was canceled. Treasury Secretary Timothy Geithner said that the Obama administration will delay any proposal to reform Fannie and Freddie until 2011. “We want to be sure that as we move to reform the GSEs we are focused on retaining strong market stability in our housing sector,” according Michael Barr Treasury’s assistant secretary for financial institutions. “We cannot rebuild securitization markets on the old infrastructure. We look forward to seeing further reform efforts,” he said. Rep. Barney Frank (D- Mass.), head of the House Financial Services Committee, scheduled the hearing to examine the two companies, which stock is still publicly traded on the New York Stock Exchange. Fannie and Freddie have lost billions of dollars and have been on government life support for more than two years. Frank said the two troubled government lenders should be eliminated and replaced. The high stakes game over whether the two should be kept in business at tax payer expense, which essentially nationalizes mortgage lending, or they should be left to die will shape the future of the nation’s mortgage market. More than 80% of all U.S. mortgages written are sold to Fannie and Freddie.

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Comment by Ross Wolf
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When leftists in government need money, their most creative thought is to raise taxes on productive Citizens. Obama has to know his health care bill will force unaffordable health insurance premiums on Americans making it impossible for many homeowners to pay both health insurance premiums and their mortgage. Does Obama really want to stop the huge number of home foreclosures or destroy real estate, the largest single asset of most Americans? Obama/Democrat Forced health insurance costs will disqualify millions of home buyers qualifying for mortgages needed to stabilize property values of homes that now secure 5 $Trillion in bank held mortgages. It is foreseeable disqualifying so many home buyers could cause most homes to have little value causing banks holding mortgages to collapse. Obama’s forced heath insurance and new taxes on Americans during this horrific recession appear intended to put Americans on the “level playing field” Obama mentioned to Joe the Plumber he wanted to achieve: Obama economics could put most Americans in “soup lines” like those seen during the Great Depression.