Federal Housing Finance Agency Director James B. Lockhart III is stepping down—and given the intensity of public scrutiny on the mortgage world, who can blame him? Lockhart says he would have left even sooner, but last fall's mortgage meltdown required him to stick around. Lockhart, a prep-school friend of George W. Bush's, has worked in Washington for eight years. He oversaw Fannie and Freddie during the advent of subprime loans and other high-stakes mortgage gambles, and is credited with helping orchestrate the government takeover of the organizations. Lockhart says he'll move to New York and work on Wall Street next. His announcement coincides with the Obama administration's renewed effort to overhaul Fannie and Freddie, an effort that would transfer their troubled assets into a new federal entity and could end up splitting the two companies. At the fore of the White House's new effort is National Economic Council Director Larry Summers, who first warned that Fannie and Freddie posed a threat to the financial world more than a decade ago.