U.S. Makes $25 Billion In Mortgage-Backed Securities Sale
The U.S. Treasury said today that it had made $25 billion from the sale of mortgage-backed securities it bought back during the financial crisis. The Treasury said the sale was part of its effort to wind down the bailout programs.
"Treasury said Monday that the sales of securities issued primarily by troubled mortgage companies Fannie Mae and Freddie Mac have netted the government $25 billion in interest. The government began selling its securities one year ago. The final sales were completed last week.
"'The successful sale of these securities marks another important milestone in the wind down of the government's emergency financial crisis efforts,' said Mary Miller, Treasury's assistant secretary for financial markets."
That said the government still faces heavy losses from the rescue of Fannie and Freddie.
Reuters talked to economist Douglas Lee, who heads the advisory firm Economics from Washington. Lee said the cost of subsidizing Fannie and Freddie will continue to weigh heavily. But every now and then the government will come out on top like in this deal.
"A lot of these assets that were acquired were distressed at the time that they were bought so the chances of coming out ahead in selected areas is quite good," Lee told Reuters.