Downsizing Mortgage Giants Fan And Fred

"Fannie and Freddie have expanded beyond their original government charter of providing affordable housing to low-income Americans - so much so, they now control half of the $7.6 trillion US mortgage market. Their portfolios grew some tenfold between 1990 and 2003. Critics contend they've used those portfolios simply to generate profits for their stockholders, not to further their charter."

Proposed new legislation would to reign in Fannie Mae and Freddie Mac "reflects a growing, post-Enron alarm in Congress over the risks a potential collapse of these two beasts poses to the nation's economy. Yet officials at Freddie Mac have already signaled opposition to these reforms - which are endorsed by lead Bush administration officials - saying they would 'adversely affect our future profitability.' "

Thanks to Chris Steins