Geithner Affirms U.S. Role as Mortgage Backer - NYTimes.com: "He said continued government support was important “to make sure that Americans can borrow at reasonable interest rates to buy a house even in a downturn.” The absence of such support, Mr. Geithner said, would make future recessions more severe because private lenders would not provide enough money for loans.
His opening remarks underscored the limits on the possibilities that the Obama administration is pondering as it opens a public conversation on reworking the government’s role in housing finance — including the future of the housing finance companies Fannie Mae and Freddie Mac, now wards of the state..."
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Government is borrowing money on a large scale, and Geithner wants to commit government to support the F&F in a big way. Why should the government encourage home ownership and not something else? Instead of creating another bubble, why doesn't the government reduce the burden on people, like cost of health insurance and cost of healthy food?
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