Government officials are likely seeking to avoid a full-fledged takeover of the companies, said Bert Ely, an Alexandria, Va.-based banking industry consultant and a longtime critic of Fannie and Freddie. More likely, he said are less-sweeping moves to calm rattled debt investors.
Those include having the Federal Reserve or Treasury Department lend to the companies. A government purchase of shares, he said, is "the step of last resort."
Brian Faith, a Fannie Mae spokesman, said in an e-mailed statement that the company "continues to exceed our regulatory capital requirements ... We continue to provide stability and liquidity to the housing market and we will continue to play a key role as the market recovers from this cycle."
Freddie Mac spokeswoman Sharon McHale said the Barron's article "significantly overstates Freddie Mac's financial situation" and said the company is "financially sound."
http://biz.yahoo.com/ap/080818/fannie_freddie_bailout.html?.v...
$4.55 (08/18/08)
