With all the hooplah over Congressional action to allow Fannie Mae and Freddie Mac to make more and larger loans, the financial press is just starting to notice that maybe it will mean larger, and perhaps a quicker problems for the GSEs.

I said this when they originally expanded their services to some “Jumbo” mortgages that this was ill advised, and with them controlling about 80% of the mortgage loans bought by investors, this is going to get ugly.