Fannie and Freddie served as 'disciplining device' in sub-prime market
Atlanta Fed paper looks at how agencies influenced risk characteristics pre-crisis
US mortgages that were eligible to be bought by Fannie Mae and Freddie Mac before the financial crisis had "similar (or slightly worse) ex ante risk characteristics than those targeted at other investors, but they performed significantly better during the crisis", according to a Federal Reserve Bank of Atlanta working paper.
The effect of large investors on asset quality: evidence from subprime mortgage securities, by Manuel Adelino, Scott Frame and Kristopher Gerardi, examines how the
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