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Mr. Jackson said Fannie Mae and Freddie Mac “have a role” to play in reviving mortgage credit.

“Can they resolve the whole problem? No,” he said. “But I think they can help curb the problem to a point.”

Mortgage analysts agreed that Fannie Mae cannot entirely cure what”s ailing the mortgage markets.

Joshua Rosner, analyst with Graham Fisher, said “mass delusion” on Wall Street has led many investors to pray for a bailout, but the agencies will be unable to buy the most troubled loans in the sub-prime and “Alternative-A” categories where liquidity dried up. He added it would take an act of Congress for them to get into the jumbo loan business.