Takeover no ‘panacea for bad debts’

THE takeover of the two biggest mortgage providers in the US, Fannie Mae and Freddie Mac will help ease the credit crunch crisis.

But leading economist Clive Granger warned the move was not a panacea for all the bad debts lurking below the surface in the US mortgage market.

“What’s amazing is that no one seems to have quantified the whole problem. The problem was much bigger than anyone anticipated and no one has been able to add up the figures and say this is what the figure is because you can’t untangle the damn stupid passing on of the debt internationally,” said Granger.