mr. demarco.embers of congress, some 18 or 19 of us have asked them to move forward with regard to some reforms that would be helpful, like such as principal wright down. while he said he didn't have the authority, we showed him he had the authority. then he changed and basically said he wouldn't do it. so all we're saying is that we think that's what will bring maximum benefit, not only to homeowners but also to taxpayers. >> good morning, congressman. your old friend and colleague harold ford. i hope you're well. good to see you in new york. >> good to see you. >> you were explaining interest and i hope you elaborate a bit your position. there may be some in the business community that might not understand why you're asking a regulator to resign because he doesn't agree with you. your point around housing is he has this responsibility and this role and he's not fulfilling it. what has his response been to this and where do you see this going here in the next two weeks as you get closer to a deci

mr. demarco has done at the fha, what will the administration's reaction be or position be if decides and fails to adopt the new provisions because he believes that it has a tremendous cost to the taxpayers of this country? >> well, we've actually been working very closely with mr. de marco. he's been overwhelmingly supportive there's some areas where we disagree a bit. of course, what congress designed for the fha, the administration has no authority over the choices he makes in this area. but we believe it's best served by initiatives h the area. we'll work to encourage and adapt those as we have quite successfully for three years. on the issue of principle reduction, there's a very strong economic and financial case to provide principle reduction in some circumstances where people are deeply underwater and face a hardship, like a loss of job. and that's why you're seeing banks and investors across the market doing principle reduction on a much larger scale in those ic do you have a counter part? can you spent us your analysis and how your numbers compare to those numbers? >> we're in i

mr. demarco and effort gets done. i believe that the american taxpayer owed him a debt of gratitude for not allowing some of the various entities to explode fannie mae and freddie mac. >> you recently announced that more beam may be underway. a month and a half ago, the president announced a policy that would force doctors to pay brother declares mortgages. mr. demarco talked about how principal productions would be a net loser. there are also great concerns about the moral hazard as well affecting the taxpayers forking peoples mortgages. my question is this, given the terminus john that mr. dimarco has done, but is the minute administrations reaction if he fails to adopt some of your provisions because he believes that it has terminus costs to the taxpayers? >> we have actually been working very closely with mr. demarco. he has been put in a tough job, as he said. he has been overwhelmingly supportive as we are opposed to repair the damage in the housing market. there are some areas where we disagree, of course, unde

mr. edward demarco's stand against that.et me ask you -- you specifically say in your reporting on this that if this thatmr. edward demarco does what his critics want, that would be a taxpayer gift to the banks. to explain how that would work. guest: this is an interesting piece of the puzzle that you do not hear from the critics. it is a little bit complicated. many of the loans that were financed or guaranteed had second liens on top of the first. fannie mae and freddie mac had the first, somebody else has the second. typically a major bank. these were the loans that allowed borrowers to get to 100% -- 0% down payment. if you write down the principal on the first and leave the second intact, that is a gift to whomever owns the second because their loan will be more likely to be paid off. if you did a principal reduction program where both loans were written down, that is another matter. that is equality and fairness. when these people talk about writing down the first, they are not talking about making the banks write down

mr. demarco controls all of the loans guaranteed by fannie mae and freddie mac. how many can be affected by his decision? >> not millions. it is a little hard to tell. i know it is not part of the popular wisdom. but there are more conservative and more careful in their underwriting standards. so the quality of their loans are better than the broader market in this context. again, our job is to make sure we are doing a reading weekend to reach as many people as we can. whether this is a good strong case on the merits, not just on the taxpayer. >> thank you. the secretary will also send you a copy of the field during intermission from brooklyn which actually has said and other representatives testimony to the points to your brief before you come back to the ranking member. with that, we go to the chairman of the full committee emeritus for five minutes. >> is that what you call me? >> annmarie this is a forever term. -- emeritus is a forever term. >> according to crs, the exposure that the united states has in portugal as of last year is $54 billion. ireland is 11

mr. demarco reported in "the financial times." and if you're tweets us -- a viewer tweets us -- and here is mr. demarco responded to critics in the senate banking committee. [video clip] >> i take it seriously but we of communities and families across the country that have been greatly harmed by this. fhfa is trying very hard to be a part of bringing solutions and stability back to this. i will do so in a disciplined way following the mandate i believe congress has given us. host: this last pieces from your column where you write, -- it is far easier to rail against one man who is preventing the great american housing recovery and, you say, the cries are bound to become even more strident. can pick up the theme from there, please? guest: again, this goes back to the criticisms that are being launched at ed demarco at fhfa. he has a duty. if congress writes a law that says he is a conservator, they can do principal productions even if they reduce taxpayer losses, he will do so. why did is going on here is that they are pressuring h

mr. edward demarco that helps to set the disagreement between the two. let's listen to that. [video clip] >> one of the questions was to stop the bleeding and preserve some function in the housing market without the losses that have preceded it. has that worked? you do not want to be sentenced to a lifetime as the conservator. has that worked out? >> i believe it has. we have brought stability to the marketplace so mortgage finances continue to operate fairly and effectively. host: gretchen morgenson, you described barney frank as the democrat who supported fannie mae almost to its collapse. tell us more about where he is coming from. guest: susan, what is interesting about these criticisms of mr. edward demarco, they are very similar to the criticisms that were lodged at the same regulator, a different name at that time, when fannie mae and freddie mac were in full bloom and operating as private companies with shareholders to satisfy. the criticism lodged back then was any time it would try to rein in the companies, any time it would try to investigate, these critics would c

lauren demarco is live there with the latest. >> reporter: mr. cheney remains in intensive care here. it's not clear how long he will be at the center. there is no comment because of the privacy issues, but experts do say the transplant or heart transplant patients are in intensive care for several days and remain in the hospital for up to two weeks. they will also take an immune suppressing medication, likely for light, and that is to keep your body from attacking the new organ. a little bit of background about the inova fairfax transplant center, the website said it performed the first transplant in 1986, and the success of the transplant succeeds all national averages. hopefully he is in good hands here. mr. cheney is 71 years old and has an extensive history with when it comes to heart health. he suffered five heart attacks since age 37 and his office released a statement saying in part, in 2010, mr. cheney had a left ventricular device for treatment of early and end- stage heart failure. and has been on the cardiac transplant list for 20 mon