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U.S. Takeover of Mortgage Giants Followed Failed Talks at Davis Polk
The announcement this weekend of a U.S. takeover of the nation’s two mortgage giants followed failed talks with potential Freddie Mac investors at the headquarters of Goldman Sachs and law firm Davis, Polk & Wardwell.
Freddie Mac chief executive Richard Syron made the last-ditch pitch to investors three weeks ago after the stocks of his company fell more than 60 percent in July, along with the stock of Fannie Mae, which had already raised $7 billion in new capital, the New York Times reports.
After the failed talks, Treasury Secretary Henry Paulson concluded he had to exercise the power given to him by Congress in July. This weekend he announced what could become the biggest and… Continue reading...
