Election Hands Frank Finance Chairmanship

Democrats have won control of the House, which will allow Rep. Barney Frank, D-Mass., to chair the Financial Services Committee and press for new housing production programs and predatory-lending legislation.In the Senate, the Democrats may have won a one-seat majority, depending on the outcome of a probable recount in Virginia. Despite the uncertainty, Senate Democrats will probably act as if they have won control when Congress returns for a lame-duck session next week to complete unfinished business, such as appropriation bills and regulatory reform for the housing government-sponsored enterprises. Floyd Stoner, the top lobbyist of the American Bankers Association, said it is difficult to tell what the lawmakers will do after the "shock" of the election results wear off. However, GSE reform is an issue where both the House and the Senate have acted, and it is "pretty clear where a resolution would be," he said. "But even with all that, getting anything done will be difficult." The election results boosted Fannie Mae's and Freddie Mac's stock prices as investors realized that the Republicans have lost their chance to scale back the GSEs' mortgage portfolios.