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Fannie Not Ready for U.S. Control to End, Milken Institute Says

Jan. 8, 2019, 3:10 PM

Fannie Mae and Freddie Mac should remain under government control until lawmakers agree on a bipartisan overhaul of the mortgage giants, because releasing them sooner risks repeating mistakes that led to the 2008 financial crisis, the Milken Institute argues in a newly released paper.

The companies aren’t ready to be freed because of “critical flaws” in their charters, the think tank says in a report to be released Jan. 8. A key issue that policy makers haven’t addressed: shareholders would still get their profits, while taxpayers would remain on the hook for losses, the report says.

Releasing Fannie and Freddie ...