...illustrates the sense of urgency for Congress to act quickly in setting the direction for FHFA. FHFA admitted such in a recently released document. It's all about jobs. In a nutshell, the high unemployment rate won't decrease until investors know the rules of the game before putting their money at risk. Congress needs to define the rules NOW! They really are behind the 8 ball on this one. Release F&F from conservatorship and investment money would come pouring in, causing unemployment to drop like a rock and sending the DOW to much higher levels.
"We’ve thrown out the baby with the bath water. We must bring back the good parts of private investment which will bring our economy back to sustainable growth level, above 3%. People need jobs and they need them now.
The conservatorship of the GSE’s is the single greatest impediment to the return of private capital in the mortgage market. Investors need to know the rules of the game before they come back and put their money on the line.
The uncertainty created by Congress in this all important economic sector is the ultimate job killer in the USA, one of the big reasons unemployment is still hanging up near 7.6%.
Most damaging, much of the private sector infrastructure which drove the system to such great heights is being destroyed. Just last week, Morgan Stanley announced it’s exiting structured businesses including securitization units, to focus on trading for clients and to set a goal of cutting risk-weighted assets, or RWAs, under new Basel III rules by 60% from a peak of almost $500 billion during the financial crisis."
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