The Federal Reserve and the Treasury have announced steps to shore up mortgage giants Fannie Mae and Freddie Mac, whose shares have plunged as losses from their mortgage holdings threatened their financial survival.
Congress has been asked to approve a sweeping rescue package that would inject billions of federal dollars into the the faltering companies. Separately, the Federal Reserve said that it would promote up to $300 billion dollars of short-term low interest loans to Fannie and Freddie.
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AFL-CIO chief economist, Ron Blackwell, emphasized both the need to bail out Fannie and Freddie and the urgency of addressing the systemic problems that produced their collapse. He says that the current system amounts to Socialism for the rich and Capitalism for the poor.
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