Federal Government Pumps $190B Into Fannie Mae & Freddie Mac to Keep the Mortgage Giants Afloat
Susie Gharib: Nine out of every 10 new mortgages now come from Federal agencies or the Federally controlled mortgage firms Fannie Mae and Freddie Mac. To make sure Fannie and Freddie can keep those loans flowing, the government is changing the terms of the deal it struck when it took control of the two mortgage giants. As Darren Gersh explains, the move is designed to reassure nervous markets. Karen Petrou, Mng. Dir., Federal Financial Analytics: Each year, they have to come up with $19 billion in dividends, which, when you’re not making much money, is hard to do. So they have been borrowing money to pay the dividends to borrow the money to pay the dividends.
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