The last two days of Senate Banking hearings, while partisan, nonetheless showed glimmers of an outline on compromise housing-finance reform with viable, if not optimistic, prospects for Senate passage.  And then along came the President, issuing a memo starting a Treasury/HUD project designed to reallocate U.S. housing finance along vaguely-defined, new lines in which the GSEs or some sort of successor does a slice of the middle-class market, FHA and Ginnie do HLTV or other targeted sectors, something is done about the Home Loan Banks, and whatever’s left goes to the private sector.

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