Tags: housing | finance | reform

Hensarling: Financial Woes May Grow Without Housing Finance Reform

Image: Hensarling: Financial Woes May Grow Without Housing Finance Reform
Rep. Jeb Hensarling (Reuters)

By    |   Thursday, 12 July 2018 02:14 PM

If the United States keeps relying on the "broken models" of Fannie Mae and Freddie Mac, the nation's financial struggles may continue despite recent economic gains, Rep. Jeb Hensarling warned Thursday.

"It remains absolutely critical that we reform housing finance, have a sustainable system, [and] quit relying on these broken models of [Fannie Mae] and [Freddie Mac],” the Texas Republican said during an interview on Fox Business' "Mornings With Maria."

The Trump administration is seeking to make the two mortgage giants private. Ten years ago, the mortgage companies were placed into conservatorship.

Hensarling, though, said that he believes many of the same mistakes that brought about the 2008 crisis for the two companies are still being made.

However, the tax regulatory relief has left many seeing the "best conditions of their lifetime," said Hensarling. "We need to modernize our capital formation laws. That's what the House is working on today."

Meanwhile, Hensarling said he's concerned that capital levels may remain low, despite the president in May signing a bill easing regulations on all but the largest U.S. banks.

“That was the whole thrust of the Financial CHOICE Act and that was a tradeoff for high levels of source-absorbing capital to be a tradeoff for a much, much lower regulatory burden," Hensarling added.

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Politics
If the United States keeps relying on the "broken models" of Fannie Mae and Freddie Mac, the nation's financial struggles may continue despite recent economic gains, Rep. Jeb Hensarling warned Thursday.
housing, finance, reform
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2018-14-12
Thursday, 12 July 2018 02:14 PM
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