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Okay Fannie Freddie have cost taxpayers more than 150 billion dollar since the 2008 -- aren't really helping the housing market.
Things worse our next guest says government destroyed the -- and -- housing finance system.
And it is time for them to go Anthony Sanders George Mason University senior scholar joins us now.
I think -- to have you with that so I think most people and government regardless of party do agreement government itself the Treasury Secretary Timothy Geithner said that the government really does need to back out of the house market but can it be done swiftly quickly and in an orderly way.
No it can't -- was us and an event and Capitol Hill where I was speaking about.
Know how we got here the Clinton administration.
Took all the safety is off the housing torpedo it.
Blow us up.
And the Bush Administration didn't do much to put the safety is back on.
Now we're talking about what do we do here and every time you mentioned let's put the safety speck on the torpedoes we don't blow it up again.
That's a tough political fight how close -- -- blow up.
I think exactly effect we're talking about.
Dodd-Frank -- the 20% down.
The same lineup of suspects now lobbying congress to get rid of Dodd-Frank not the yes some of Dodd-Frank had just slowdown in the part.
Which is exactly this problem the -- the bubble to burst in the first place.
So what -- the long -- solution to the problem of Fannie and Freddie I mean it's right now it's a hybrid sort of public and private entity.
Should be all public girl private or go way -- -- OK we'll first -- probably go away altogether.
All private my second.
Favorite small public we already have the FHA but.
Also it wouldn't be enough liquidity in the market of you didn't have them in their backing up these mortgages that people wouldn't be able to get mortgages.
Because the government's taking a lot of risk I mean how do you battle that argument.
Well -- -- the argument we have this big entity over here called the Fed the place looks like the mausoleum that you've seen -- cut pollution avenue.
That they're back stopping MBS till the cows come home why that we need Freddie and Fannie do the same thing the Fed's doing.
-- maybe that's too much they would need a little more risk taking and bearing the costs of those consequences we restructure these loans and expedite the process especially -- a principal reduction.
I warned you don't not do principal reductions.
-- for -- why although I know certain people arguing fort here's the problem Guinea we -- to get inequity that in my house Tony.
At the well.
I'd be more than happy to help you but I think we haven't done enough studies on whether it's going to cost Fannie and Freddie even more money supposing it cost them another.
-- hundred billion dollars how happy will taxpayers -- Now some people climate doesn't I think it's gonna cost taxpayers quite a bit of money that's what Ed DeMarco and FHA -- face is basically essentially saying that.
If I do principal reductions it's going to be about this much -- -- This has no compelling evidence.
Our right lot -- thought that you want.
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