The Treasury secretary, Henry M. Paulson Jr., said Sunday there are no plans to use his new authority to inject capital into mortgage companies Fannie Mae and Freddie Mac, which both posted worse-than-expected earnings last week.
Mr. Paulson and Congress brokered a plan last month to bolster the two government-sponsored enterprises that includes giving the Treasury the right to buy their shares. “Given that Fannie Mae and Freddie Mac are solely involved in housing, that’s their sole business, and given the magnitude of the housing correction we’ve had, it’s not a surprise to me to see those losses,” Mr. Paulson said.
Mr. Paulson, former chairman of the Goldman Sachs Group, also said he would not stay on as Treasury secretary after President Bush’s term ends in January, regardless of who is elected president in November.
Mr. Paulson said the financial problems at Fannie and Freddie underscored his view that the housing crisis remained the biggest threat to the nation’s economy.
“Let’s see how this program works in the third quarter,” Mr. Paulson said.