Goldman: no turning point for U.S. housing from GSEs plan

NEW YORK (Reuters) - A major U.S. government plan to shore up mortgage finance firms Fannie Mae and Freddie Mac will not revive the ailing U.S. housing market yet, wrote Goldman Sachs economists in a research note dated Sunday.

"Ultimately, we do not view these measures, dramatic as they look, as either a turning point for the U.S. housing market or as a sign that the downturn will be much worse than previously believed," Goldman Sachs analysts including economist Jan Hatzius wrote in the note.

The U.S. Treasury and Federal Reserve plan, announced on Sunday, called for sweeping measures to lend money and buy equity if necessary in the government-sponsored enterprises, which own or guarantee $5 trillion in debt -- close to half the value of all U.S. mortgages.

The measures by the U.S. Treasury and the Federal Reserve to underpin the mortgage giants "simply reaffirm our long-held -- and widely shared -- view that the government will do everything it can to avert a meltdown in the conforming mortgage market and will continue to stand behind the government-sponsored enterprises," Goldman wrote.

Congressional approval for the plan "is highly likely", the analysts wrote, because U.S. Treasury Secretary Henry Paulson has said he has consulted with Congressional leaders of both parties and because of "the political peril of standing in the way of measures to support the flagging housing market."

(Reporting by John Parry; Editing by Chizu Nomiyama)