Bernanke: Treasury should weigh GSE debt limit tool

Reuters reports:

Federal Reserve Chairman Ben Bernanke on Thursday said the U.S. Treasury Department should consider limiting the debt Fannie Mae and Freddie Mac can sell if Congress fails to act.

Weighing in on the most contentious issue in the current debate over the companies' business and regulation, Bernanke said the Treasury Department has power to limit their debt issuance and perhaps power over terms and maturities of that debt.

"If we are unable to achieve progress through Congress, I don't think Treasury should abandon that power," Bernanke told the congressional Joint Economic Committee.

It appears that Mr.Bernanke doesn't seem influenced by Fannie Mae's propaganda.