Systemic Risk From an Outsized Fannie and Freddie?

`` Quite a few policy makers have talked up plans to use Fannie Mae and Freddie Mac as central agents in salvaging the US housing market, typically by refinancing stressed borrowers, The markets reacted badly to that, driving up the GSEs' spreads over Treasuries, but no one is getting the message, despite the fact that the Fed launched the Term Securities Lending Facility primarily to address the problem of gaping mortgage spreads.''