GSE HEARINGS CONTINUE.
THE THIRD IN A SERIES OF HEARINGS BEFORE the Subcommittee on
Capital Markets, Securities and Government Sponsored Enterprises on
strengthening regulation and promoting market discipline of the housing
government-sponsored enterprises (GSEs) took place over the summer. The
most recent hearing received testimony from the Treasury Department,
Federal Reserve, housing GSE regulators and representatives from Fannie
Mae, Freddie Mac and the Federal Home Loan Bank, as well as panels
representing consumer and taxpayer interests. The aim of the bill, H.R.
3703, sponsored by Representative Richard H. Baker (R-Louisiana), is to
shield taxpayers from the potential risk the housing GSEs pose.
Representative Marge Roukema (R-New Jersey) stated her support of the
bill in remarks made to the third hearing, saying "Mr. Baker has
raised several issues which we need to explore carefully: potential
systemic risk due to the size of the housing GSEs, appropriate capital
requirements, bank ownership of agency securities and possibl e
concentration problems." Roukema added, "I want to make it
clear, however, that while I endorse these oversight hearings, moving
this legislation is another matter. I--as well as several other
members--do not support moving this legislation forward this year....
Quick action on this would be ill advised."