The government’s groundbreaking move Sunday to take control of Fannie Mae and Freddie Mac could give a much-needed boost to the housing market and the stock market as well.
But the development is bad news for anyone who owns stock — common or preferred — in the mortgage finance giants.
On the positive side, the federal intervention is likely to bolster confidence in the financial system in general and in the debt of Fannie and Freddie in particular.
That would help to lower mortgage interest rates, reducing costs for home buyers and making it easier to qualify for a home loan.
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