The NYPost.com says Powerful lawmaker Barney Frank "had to pull his foot out of his mouth yesterday".
The Massachusetts Congressman rattled investors when he said the US Treasury won't be responsible for bailing out investors holding the more than $5 trillion of mortgage-linked securities issued by Fannie Mae and Freddie Mac – the ailing mortgage companies at the center of the junk mortgage crisis.
"Please don't think this [debt] is federally guaranteed, I don't think it is, I don't think it should be, I don't feel any obligation to bail you out," he said. In a restructuring of the firms, investors could expect a "whole range of options. . . from [being paid] nothing to a haircut to whatever."

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