More bailing out of Fannie Mae and Freddie Mac has begun. The Federal Reserve Bank of New York instituted its program to buy up “direct obligations” of Fannie, Freddie, and the Federal Home Loan Banks, and to purchase mortgage-backed securities from Ginnie Mae, Fannie, and Freddie. Up $100 billion-worth of the direct obligations will be purchased in competitive auctions; as much as $500 billion in MBS will be taken off the GSE’s hands “via a competitive process.” First results will be posted on the New York Fed’s website on January 8.

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