Wednesday, August 07, 2013
Yesterday in Phoenix President Obama endorsed a Senate proposal that would wind down the quasi-government housing agencies Freddie Mac and Fannie Mae. The President criticized the two agencies and the way in which they treat profits as part of a private business and losses as the government's obligation. Under this new system, funding for home loans would come mostly from private sources, however, there would remain some Federal government involvement to ensure the survival of the 30 year fixed rate mortgage, a product that would probably disappear in a purely private sector system. President Obama also said that our nation's housing policy should be recalibrated with more emphasis placed on affordable rental properties and less money devoted to subsidizing expensive residences for wealthy individuals. A full report on the speech from the New York Times is here.