Monday marked a significant change at the helm of two government bodies that are currently responsible for steering the housing market – and, in major ways, the entire national economy – out of the doldrums of the all-too-recent Great Recession. The Federal Housing Finance Agency (FHFA) saw the appointment of Mel Watt as the head of the department responsible for overseeing the mortgage-securing giants Fannie Mae and Freddie Mac – the two insurers responsible for more than 60 percent of the nation's home loans. Just hours later, the Senate voted to officially confirm President Barack Obama's choice for the head of the nation's central bank, Janet Yellen, to take a post overseeing the Federal Reserve.
While both of these newly-minted power holders have promised to do nothing to rock the boat too much as they take the wheels of these significantly influential institutions, there are critics that have roundly been silenced by advocates for the president's agenda.
For instance, Watt has made it clear that he would forego increasing charges to lenders who take risks on borrowers with middling to poor credit scores, a measure that the former Acting Director of the FHFA had sought to put in place in order to avoid setting the stage for the same situation that created the housing bubble.
Yellen, however, has been criticized by many senate Republicans, who voiced concerns that her policies, which are aggressively focused on boosting job growth, would be enacted with little consideration of the inflation risk they impose. In fact, the president was forced to pass a new rule that required a simple majority instead of the strict 60-vote requirement formerly in place to approve a Fed chief, as Yellen was only able to pull in 56 votes even in a Democrat-heavy Senate.
With the fate of the national economy resting in the hands of two as-yet untested figures who don't seem want to consider arguments from both sides of the aisle, it's important that your retirement investments aren't diminished, leaving you to pay for the government's mistakes.