[quote=Arraya]From mish. This is exactly what I was thinking:
Depending on precisely how the proposal is implemented, the effect may be to take poor performing loans off the balance sheets of banks and hedge funds and dump the risks squarely on the backs of taxpayers via Fannie and Freddie.[/quote]
Yes, they’ve already done this with all the mortgages that *could* be refinanced over the past few years — most of the refis have been into govt-backed loans. Now, they are going to take the worst of the worst and refi those into govt-backed loans.
