Government Announces Plan to Ease Capital Restraints on Fannie, Freddie

The AP reports :

The government on Wednesday relaxed capital requirements at Fannie Mae and Freddie Mac as part of a plan to inject an additional $200 billion of financing for home loans.

The initiative, which will require Fannie and Freddie to raise substantial funds, is part of a broader government strategy to ease a credit crisis that has made it difficult for consumers and businesses to borrow, and spread fear throughout global financial markets.

Fannie and Freddie helped create the mortgage mess with 4% down style mortgages and now the federal government wants to throw more leverage into the system.Fannie and Freddie are in big financial trouble.