Bill Poole, former president of the St. Louis Federal Reserve Bank, is worried that all kinds of companies will seek Federal Reserve financing now that the central bank has made liquidity available to Fannie Mae and Freddie Mac. Real Time Economics reports on prepared remarks for a speech that Poole was to deliver today in Washington:

Poole called it “naive” to think nonfinancial companies in sectors like automobiles and airlines or even municipalities won’t ask for the same privilege if they’re in similar trouble, especially given their large effect on employment.

“The Fed said no to New York City in 1975 and no to Chrysler in 1979,” Poole said, but “with the Bear Stearns precedent, it will not be so easy to say no next time.”

“What I anticipate is that we will not know the limits to Fed lending until the Fed says no to a large, influential firm seeking help,” Poole said.

Poole also said that losses at Fannie and Freddie may total $300 billion, and that last weekend’s bailout “settles nothing” about the firms’ long-term role. He had often sounded the alarm, in this 2005 speech and elsewhere, about the risks that Fannie and Freddie posed to taxpayers.