In order to gain a meaningful idea of the risks of a large conglomerate, some financial authorities have suggested that supervision must cover the relevant risk positions of the  1  Letter to Congressman James A. Leach, January 20, 2006. Board of Governors of The Federal Reserve System. BIS Review 95/2006  5  entire group. This constitutes a formidable challenge.
For example, the GSEs were reluctant earlier this year to raise capital and to expand their operations, even though this would have helped financial and macroeconomic stability at a time of much-reduced mortgage availability. The GSEs' disinclination to support the mortgage market was motivated by the fact that raising additional capital would have diluted the values of the holdings of the existing private shareholders.