Bernanke Criticizes Fannie, Freddie Bill
In his first appearance before Congress as Federal Reserve chairman, Ben S. Bernanke picked up where Alan Greenspan left off, criticizing a House bill that would strengthen oversight of Fannie Mae and Freddie Mac for not going far enough to rein in the companies' investment portfolios.</br></br>Bernanke said the House bill would not give a new regulator for the two companies "sufficiently strong guidance" on how to regulate the portfolios, which he and others think have grown so large that they threaten the stability of the financial system.</br></br>"I understand the good intentions underlying the House bill, but I feel it does not solve the problems and therefore if we were to go with that bill, we would be missing the last opportunity we will have in many years to really address these problems," Bernanke said.</br></br>Congress is considering legislation to tighten oversight of the two companies after multibillion-dollar accounting scandals.</br></br>The bill Bernanke took issue with yesterday passed the House last fall. Critics of Fannie Mae and Freddie Mac, including Greenspan, prefer a Senate bill that would force the companies to sell much of their investment holdings.