$300 Billion to Save Fannie, Freddie

William Poole, former president of the Federal Reserve Bank of St. Louis, said taxpayers may face a $300 billion bill to revive Fannie Mae and Freddie Mac, the mortgage giants being taken over by the Federal government. "I would not be surprised if their total losses aggregate about 5 percent of their obligations" of about $6 trillion, Poole said in an interview. He said financial fallout from Fannie and Freddie was likely to be a long-term drain on the Treasury. Treasury Secretary Henry Paulson said he would replace the chief executives of Washington-based Fannie Mae and McLean, Virginia-based Freddie Mac and eliminate their dividends.