Uncle Sam is stepping in to aid Fannie Mae and Freddie Mac. One might question the wisdom of government bailing out mortgage companies. In this case, I don’t. Fannie and Freddie are part of the solution, not part of the problem. By definition, they were not sub prime lenders. They just bore the brunt of problems borne of the sub prime meltdown.
Should the government help irresponsible banks that fueled the economic crisis by making reckless loans? Never. Should they take steps to shore up the institutions that are the standard bearer of responsible lending? You bet they should. It is the system working. The Federal Home Loan Mortgage Corporation and the Federal National Mortgage Association, as Freddie and Fannie are less commonly known, are implicitly backed by the Fed. Now the Fed must act.