"As the Treasury plan states, this is done to increase competition in the secondary mortgage market."
Obi, Thanks,
Financial establishment is working very hard to get Gov explicit guarantees for private MBS using every possible trick. This is the main reason for continued Conservatorship. FHFA Conservatorship has violated every possible law but still all three branches Gov and media have done nothing much to end this lawless conservatorship.
There is no way any one can trust financial establishment (Wall street bankers, traders, MBA and think tank lobbyists). When was the last time the financial establishment ever promoted competition to make things better for common people? This is how financial establishment has fooled the people all along.
One can clearly see what happened when the financial establishment was freed from the Glass-Steagall Act. Within few years, financial establishment created worst financial crisis (2008) of the century through dishonest and fraudulent profiteering. Also one has to look at how the financial establishment has used its iron grip on Gov, to destroy the competition though lawless FHFA conservatorship.
GSEs were started decades back to help common people to own homes and escape from the clutches of loan sharks and evil landlords. There is no way competition is going to substitute Gov affordable housing policies.
Most lawmakers know these facts, and there is no support for removing the GSE charters. Also there is no way lawmakers will approve Gov explicit guarantees for private MBS. This is the lesson all have to learn from 11 years of lawless conservatorship.
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