The Federal government and the Treasury department teamed up Sunday putting together the final touches of a financial plan giving mortgage giants Freddie Mac and Fannie Mae some financial security. Treasury Secretary Henry Paulson is pushing Congress to approve the plan that will keep the mortgage giants solvent, Fannie & Fredie control nearly fifty percent of mortgages nationwide. 

Part of the plan is to raise Fannie and Freddie's $2.25 billion current line of credit each lender has and also strengthen the companies financial by buying shares. The Fed also offered to let the agencies borrow at the rate it charges banks. Congress will be holding hearing the next few weeks to look at this latest plan by the Feds and also the Foreclosure bill that has been going back and forth this past year that also involves Fannie Mae and Freddie Mac taking a larger roll helping homeowners on the brink of foreclosure. 

Goldman Sachs economist Jan Hatzius wrote to clients "Ultimately, we do not view these (government) measures, dramatic as they look, as either a turning point for the U.S. housing market or as a sign that the downturn will be much worse than previously believed."

By no way is Freddie and Fannie out of the woods but the government is showing through this housing and economic downturn there is no way we are letting them fail, we will see. .