Wall St. Wants A Part Of Fannie And Freddie’s Gov’t-Guaranteed Deal

As the White House considers how to reform [1] troubled mortgage giants Fannie and Freddie, some of the nation’s largest banks have piped up with their own suggestion. The New York Times reports that banks are suggesting that they be allowed to take over [2] some of Fannie and Freddie’s work of issuing securities backed by a government guarantee. That guarantee can be quite convenient for businesses, which get to keep the profits in good times and—as we saw during the housing market collapse—get to socialize the losses by passing them onto the government. From the Times:

The banks have presented their ideas publicly through trade groups. Housing industry consultants and people familiar with recent meetings at the Treasury Department say these banks view the government’s overhaul of the mortgage market as a potential profit opportunity.

GO HERE to read more.