U.S. Federal Reserve economists argued in a paper made public on Friday that government-sponsored mortgage enterprises Fannie Mae and Freddie Mac do little to stabilize markets in difficult periods.
The paper is another in a series of Fed salvos at the mortgage companies, which have been shaken in recent years by accounting controversies. Federal Reserve Chairman Alan Greenspan told U.S. Senators last year that the enterprises are likely to put the U.S. financial system at risk if policy makers do not check the firms’ growth.
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