Fannie Mae and Freddie Mac to be shrunk into oblivian

A large portion of Fannie Mae (FNMA)  and Freddie Mac (FMCC)  should be wound down over time, and the fees that the troubled mortgage-refinance giants charge for guaranteeing home loans sold to investors should be increased to ease the private sector back into the housing market, the Treasury Department proposed this week. Treasury Secretary Timothy Geithner told reporters that the reform plan would spell modestly higher mortgage costs for average homeowners over the long term.

The question is: What is considered “modestly higher mortgage costs for average homeowners”? Modestly higher doesn’t mean the same to Congress and the Treasury Department as it does to you and me.

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