WASHINGTON (Reuters) - The Obama administration is not considering a change to its policy regarding mortgage finance giants Fannie Mae and Freddie Mac, a Treasury spokesman said on Thursday.
"The administration is not considering a change in policy in this area," said Treasury spokesman Andrew Williams.
The comment followed speculation in recent days from analysts at Wall Street firms including Morgan Stanley that suggested the administration could tweak rules at Fannie Mae and Freddie Mac to spark a major refinancing wave.
On Thursday, a Reuters Breakingviews opinion column referred to rumors in Washington and Wall Street that the administration could soon order Fannie Mae and Freddie Mac to forgive a portion of the mortgage debt of millions of Americans who owe more than what their homes are worth.
Mortgage bond prices pared losses after the statement from Williams. Prior to the denial, investors were selling mortgage bonds that would sustain large losses if a new wave of refinancings took place.
(Reporting by Corbett B. Daly; Additional reporting by Al Yoon in New York; Editing by James Dalgleish)
Does show how little faith the investing community has in this administration to not meddle in the private sector. That such a rumor could be, not only not dismissed out of hand but actually move multiple stock prices sharply downward is not a ringing endorsement of the hand on the rudder. I would never have thought Jimmy Carter could be made to look competent, but in comparison he is starting to look a little better unfortunately...
See WAKE FOREST posting---Wake Forest University students are challenged to think like GS! Brilliant shorts, puts, and timing after rise expectations. HOLD, well GS will get you! Clearly not a losing trade for GS!