The U.S. Housing Finance Debacle, Measures to Assure its Non-Recurrence and Reform of the Housing GSEs
We provide another perspective regarding Fannie Mae's and Freddie Mac's impact on the recent financial crisis. We conclude that the crisis and the GSEs being placed into conservancy were primarily caused by the proliferation of below prime mortgages, which led to their sustaining significantly higher default losses. We posit that the GSEs have unfairly served as scapegoats, whereas the crisis was largely caused by the proliferation of private label subprime mortgage instruments and by the U.S. Congress implementing social policies thru the GSEs without adequate default risk provisions. Our recommendations provide guidelines that may reduce the likelihood of a future similar crisis.
Volume (Year): 36 (2014)
Issue (Month): 1 ()
|Contact details of provider:|| Postal: |
Web page: http://www.aresnet.org/Email:
|Order Information:|| Postal: Diane Quarles American Real Estate Society Manager of Member Services Clemson University Box 341323 Clemson, SC 29634-1323|
Web: http://pages.jh.edu/jrer/about/get.htm Email:
When requesting a correction, please mention this item's handle: RePEc:jre:issued:v:36:n:1:2014:p:59-86. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (JRER Graduate Assistant/Webmaster)
If references are entirely missing, you can add them using this form.