May
11

Fannie-Freddie Watchdog Says He Can’t Let Capital Go to Zero

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  • FHFA Director Watt says investor confidence would be eroded
  • Watt also rebuffed ‘recap and release’ during Senate testimony

The head of Fannie Mae’s and Freddie Mac’s regulator told lawmakers Thursday that he can’t take the risk of letting the companies run out of capital.

Investors in Fannie’s and Freddie’s mortgage bonds might begin to doubt the safety of their holdings if the companies need more bailout money, Federal Housing Finance Agency Director Mel Watt said at a Senate Banking Committee hearing. Such a scenario could disrupt the housing market and cause rates to rise, he said…

Fannie-Freddie Watchdog Says He Can’t Let Capital Go to Zero

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