Notes &
Take the US mortgage market at the heart of the present crisis. One of the largest sources of the problem is the role of Fannie Mae and Freddie Mac, the giant US mortgage companies, government-sponsored enterprises that hold or guarantee almost half of America’s $11 trillion mortgage market. They facilitated much of the explosion of the mortgage-backed securities market in the US and they did so because investors always believed that these oddly public-private hybrids carried an implicit government guarantee. (They were right.)
