- Political Diary Wall Street Journal July 29 2008 _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
"It turns out the biggest supporter of the Fannie Mae and Freddie Mac
bailouts has been the Chinese government. The Chinese own about half a
trillion dollars in Fannie and Freddie securities and they've put the
warning out to Treasury Secretary Hank Paulson they expect to be repaid in
full. The fear among Mr. Paulson and other Treasury officials is that if
Fannie and Freddie debt isn't repaid at 100% par, the Chinese may start
dumping their hundreds of billions of dollars of Treasury securities,
possibly causing a run on U.S. government debt and sharply raising Uncle
Sam's borrowing costs."
