[quote=Hobie]
Then why did Freddie and Fannie buy the paper from the banks who issued loans mandated by the policy?[/quote]

That’s kind of like asking why apples are red. They bought the loans because thats what they do.

If you’re somehow arguing that Fannie and Freddie are to blame for the current mess, you need to review what happened over the last 5 years. The percentage and dollar value of non-GSE loans skyrocketed. The GSE’s stayed relatively flat in comparison.