Fannie Mae, Freddie Mac Shares Jump on Fed Plan

Freddie Mac shares were up 15 cents or 33.3 percent to 60 cents during morning trade while Fannie Mae climbed 16 cents or 47 percent to 50 cents.

The Federal Reserve took new steps to unfreeze credit for consumers and business owners by announcing plans to buy up to $600 billion in mortgage-backed assets, the Fed said in statements today in Washington.

It will also buy up to $100 billion in direct debt from Freddie Mac, Fannie Mae and the Federal Home Loan Banks. The Fed will buy another $500 billion in asset-backed securities.

"This action is being taken to reduce the cost and increase the availability of credit for the purchase of houses, which in turn should support housing markets and foster improved conditions in financial markets more generally," the Fed said in a statement.

The plan marks the government's latest attempt to provide liquidity to the credit markets and it contributes to the $700 billion financial-rescue package recently approved by the U.S. Congress.

Treasury Secretary Hank Paulson called for patience as authorities moved to deal with the current crisis.

"It is naive for any of us to think that when you're dealing with a situation of this magnitude that a bill could be passed or a single action taken to make all the issues go away. Our focus is on stability and strengthening the financial system and we now have the tools and powers we need to work with others," Paulson said in a press conference.