The Treasury Department wants Fannie Mae and Freddie Mac to submit estimates of their borrowing needs for the first quarter as the department tries to exercise its authority over GSE debt issuance.The debt notification requirements have not been finalized yet, a Treasury spokeswoman said. "But the hope is to have it start at the beginning of the first quarter of 2007," she said. It seems the two government-sponsored enterprises will be expected to submit their estimates in December. And Treasury officials are promising to make a "prompt response" on the debt issuance requests. Fannie and Freddie knew something like this was coming, but they have declined to comment on the Treasury's move. "Until they officially notify us, we are not going to comment," a Freddie spokeswoman said. During the summer, Treasury Secretary Henry Paulson instructed his staff to come up with a debt approval process so that the Treasury has a practical option for limiting GSE debt. "Given Secretary Paulson's market expertise and the fact that Fannie Mae and Freddie Mac have $1.5 trillion in outstanding debt, this move to formalize the debt approval process makes sense," said House Financial Services Committee Chairman Michael Oxley, R-Ohio.

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