Federal regulators tried to assure the financial markets yesterday that mortgage lenders Fannie Mae and Freddie Mac "are adequately capitalized," while lawmakers said there is a growing consensus that the Federal Reserve Board should be granted more regulatory authority over broker-dealers.

Fed chairman Ben Bernanke and Treasury Secretary Henry Paulson testified before the House Financial Services Committee about the state of U.S. market regulation and how a replay of the Bear Stearns collapse and mortgage crisis could be prevented in the future.

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