Remarkable Vindication of Unanimously Agreeable and Constitutional Governance: Order of U.S. President on Recapitalization and Release from Conservatorship of Fannie Mae and Freddie and Presidential Executive Order on Academic Freedom


The optimal bank foreclosure rule published in 1989 in the Journal of Finance was enacted as law (Federal Deposit Insurance Improvement Act of 1991).

Just before the above paper was published in 1989, US Congressional Budget Director consulted me (while I Assistant Professor of Finance at New Yourk University) to devise optimal policies for Fannie Mae and Freddie had then no idea about the difference between banks and Fannie-Freddie.

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