U.S. Treasury Makes $25 Billion Profit On Mortgage Bonds
Taxpayers should be happy about a $25 billion profit as the result of a government investment at the height of the meltdown.
Treasury had spent about $225 billion on purchases of mortgage debt over 16 months before it began selling the securities last year…
The government last week sold the last of the bonds, liquidating the Treasury’s ownership of debt backed by Fannie Mae…and Freddie Mac…
Investors were worried about the movement of asset prices in the event of curtailment of government support.
“We said if we thought there was any stress in the market around this, we would pull back,” Mary Miller, the Treasury’s assistant secretary for financial markets[told the Wall Street Journal].
“We frankly never saw that and just continued,” she added.
The mortgage purchases were one of the tools employed by the U.S. government to prop up the financial system at the height of the credit crisis.