Private Cries: The Case for Cutting Fannie Loose

Portfolio.com reports:

a couple of years back some economists looked at how well Fannie and Freddie were doing in their assigned missions of providing opportunities for low- and middle-income households to buy homes and providing liquidity to the mortgage market through the securitization process. Kristopher Gerardi of Boston University, Harvey S. Rosen of Princeton University , and Paul Willen of the Boston Federal Reserve found no evidence that GSE securtization helped lower income households buy more homes or that the GSE's activities have helped improve mortgage market efficiency. Other studies have shown that, at best, the existence of Freddie Mac and Fannie Mae have reduced mortgage rates by about 25 basis points.

Time to separate housing from state.