US’ Geithner: no going back for Fannie, Freddie

WASHINGTON, Aug 17 (BestGrowthStock) – U.S. Treasury Secretary
Timothy Geithner said on Tuesday that Fannie Mae and Freddie
Mac cannot be returned to their pre-crisis structure as
stockholder-owned firms with implied government guarantees.

Geithner, in excerpts of remarks to be delivered at a
Treasury conference on the future of housing finance, said
fixing government-controlled Fannie (FMMA.OB: ) and Freddie
(FMCC.OB: ) is one of the most “consequential and complicated”
problems facing the United States.

“We will not support returning Fannie and Freddie to the
role they played before conservatorship, where they took market
share from private competitors while enjoying the perception of
government support,” Geithner said. “We will not support a
return to the system where private gains are subsidized by
taxpayer losses.”

Geithner said the government needs to more clearly
delineate housing policy goals, separating efforts to promote
reasonably priced and stable mortgage costs for most Americans
from efforts to provide affordable housing for lower-income
Americans.

The Treasury seized control of Fannie and Freddie to save
them from collapse in September 2008 and has run them under a
government conservatorship, injecting nearly $150 billion in
taxpayer capital into them to cover their mortgage losses.

(Reporting by David Lawder, Editing by Sandra Maler)

US’ Geithner: no going back for Fannie, Freddie