Schumer urges action on subprime

Amid reports that market conditions are affecting higher-rated borrowers more than expected, Sen. Charles Schumer said the Federal Reserve and other U.S. regulators may not be doing enough to address the threat posed by subprime defaults to the housing market and the economy. “Federal regulators may be underestimating the real risk that the spillover from the subprime mortgage market could cause significant disruption in the mortgage and consumer-credit markets as a whole,” Schumer wrote yesterday in a letter to Fed chairman Ben Bernanke. Schumer urged “prudent steps to prevent the situation from deteriorating further.” more [Bloomberg via Post]