Both Fannie Mae and Freddie Mac have approached the Treasury Department for additional funding in recent days. Last week, Freddie Mac requested another $6 billion in aid after reporting that its loss had grown to $4.4 billion for the third quarter. On Wednesday Fannie Mae reported a $7.6 billion loss for the quarter and asked the Treasury Department for $7.8 billion. Both GSEs have cited low mortgage rates, declining home prices and growing defaults as the source of their red ink.
Congress, needless to say, is hardly pleased with this latest trip to the Treasury’s coffers, to say nothing of their general performance. The latest sign of its discontent is a measure proposed by Sens. John McCain (R-AZ) and Jay Rockefeller (D-WV) to prohibit executives at GSEs from receiving bonuses so long as the agencies are in conservatorship.
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