Jeb Hensarling: “But when it comes to the use of the portfolio holdings of Fannie and Freddie, which we know, number one, according to…”

“But when it comes to the use of the portfolio holdings of Fannie and Freddie, which we know, number one, according to the last two, the present and the past Chairmen of the Federal Reserve, creates huge systemic risk to our economy, which ultimately can bring down housing opportunities for all. But if I could quote from a speech from Chairman Greenspan, who said, ``The Federal Reserve Board has been unable to find any credible purpose for the huge balance sheets built by Fannie and Freddie other than the creation of profit through the exploitation of the market- granted subsidy.'' To paraphrase, ``Their purchase of their own or each other's mortgage-backed securities with their market-subsidized debt do not contribute usefully to the mortgage market liquidity, to the enhancement of capital markets in the United States, or to the lowering of mortgage rates for the homeowners.''”