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McCain Says Wall Street is the`Villain'

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McCain Says Wall Street `Villain' in Subprime Crisis

By Christopher Stern

July 27 (Bloomberg) -- Senator John McCain put the blame on Wall Street for the home mortgage credit crisis that has roiled financial markets around the world.

``Wall Street is the villain in the things that happened in the subprime lending crisis and other areas where investigations and possible prosecution is going on,'' McCain said during a taped appearance on ABC's ``This Week'' program.

The Arizona Republican, who has wrapped up his party's presidential nomination, said he supports the housing bill passed by Congress yesterday to stem foreclosures and aid Fannie Mae and Freddie Mac, the largest U.S. mortgage-finance companies, even though it may cost taxpayers as much as $25 billion.

McCain, 71, said the risk of the mortgage companies' failure is outweighed by the potential cost. He also said Fannie and Freddie should be barred from lobbying Congress and their executives' compensation should be reduced.

``We should eliminate the pay and bonuses that these people rake in,'' McCain said

Senator Barack Obama of Illinois, the Democratic presidential candidate, generally agreed with McCain's point of view during a taped appearance on NBC's ``Meet the Press.''

Market Liquidity

``Any assistance to Fannie Mae or Freddie Mac should not be focused on the investors and the shareholders,'' he said. ``It should not be focused on management.'' The emphasis should be on ``ensuring there is liquidity in the housing market,'' Obama said.

Today in Chicago at the Unity '08 Presidential Candidates Forum, Obama said the housing bill passed yesterday is ``a good start in trying to create a floor beneath which the housing market will not sink.'' He said the U.S. has ``to do more'' and that the economy ``has worsened enough that we need a second round of stimulus.''

McCain said, if elected, he would support broad bipartisan negotiations with Democrats over the future of Social Security and other economic issues, with ``everything on the table.''

Asked if that includes payroll tax increases, which McCain opposes, he replied: ``There is nothing that's off the table.''

``I have my positions, and I'll articulate them,'' McCain said. ``I don't want tax increases.''

Full story, source: Bloomberg

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