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WASHINGTON, DC - July 15: Treasury Secretary Henry M. Paulson Jr., Federal Reserve Chairman Ben S. Bernanke, and Securities and Exchange Commission Chairman Christopher Cox testifiy during the Senate Banking hearing on turmoil in the capital markets and the prospective regulation of Fannie Mae and Freddie Mac. The Bush administration's proposals to help faltering mortgage giants Fannie Mae and Freddie Mac hit some speed bumps Tuesday on Capitol Hill, as congressional Republicans demanded more deliberate and careful consideration. In the face of numerous questions and skepticism among members of the president's own party, Democrats backed away from plans to rush the plan through the House this week as part of a sweeping housing and mortgage finance package (HR 3221) already moving through Congress. Late on July 13, the Bush administration moved forward with an ambitious plan to shore up the troubled mortgage financiers. Under the plan -- parts of which require congressional approval -- the Treasury Department will increase an already-existing government line of credit to Fannie and Freddie and is asking Congress for the authority to buy an equity stake in the companies to keep them financially sound. The plan also calls for including the Federal Reserve in a supervisory role over Fannie Mae and Freddie Mac, both government-sponsored enterprises (GSEs). The broader housing package also would create a strong new regulator for the two GSEs, with the authority to set capital standards and limits on the companies' portfolios. Bush on Tuesday urged Congress "to move quickly to enact the plan in its entirety, along with the good oversight legislation that we have recommended for both Fannie Mae and Freddie Mac. This is a part of a -- should be part of the housing package that is moving its way through the Congress. And I hope they move quickly." He stressed that the proposed new authorities to rescue Fannie and Freddie "will be temporary and used only if needed." Treasury S

WASHINGTON, DC - July 15: Treasury Secretary Henry M. Paulson Jr., Federal Reserve Chairman Ben S. Bernanke, and Securities and Exchange Commission Chairman Christopher Cox testifiy during the Senate Banking hearing on turmoil in the capital markets and the prospective regulation of Fannie Mae and Freddie Mac. The Bush administration's proposals to help faltering mortgage giants Fannie Mae and Freddie Mac hit some speed bumps Tuesday on Capitol Hill, as congressional Republicans demanded more...
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