CSPAN2 Key Capitol Hill Hearings April 15, 2014
Return is two crucial features. First, they are subject to regulation not by the fed, but subject to regulation by a unit of housing and development. Their own regulator. Their own regulator. Sounds bad, but its actually worse than it is. It sounds bad, and its worse. Good for them, bad for us, turns out. Yeah. Second, they are Given Capital requirements that are about 50 40 below those for commercial banks. Allowed to be highly leveraged. That means fannie and freddie can get into the following business. Youre a commercial bank. You sell me a loan. You had to put 4 in capital behind that loan...