Fannie, Freddie Holders Shouldn’t Assume Guarantee, Frank Says

Bloomberg reports:

Fannie Mae and Freddie Mac bondholders shouldn’t assume the government will make them whole on their investments as Congress retools the companies, House Financial Services Committee Chairman Barney Frank said.

“Please don’t think this is federally guaranteed, I don’t think it is, I don’t think it should be, I don’t feel any obligation to bail you out,” Frank told reporters after speaking to a conference of black, Hispanic and Asian Realtors in Washington today. Congress will “certainly not” extend any new protections to bond and mortgage-security investors beyond what exists, Frank said.

A “whole range” of options is being considered for investors in the two government-seized companies, “from paying nothing to a haircut to whatever,” Frank said.

The struggles of American style fascism.