Saturday, December 13, 2014

Time to privatize Fannie Mae, Freddie Mac?

Time to privatize Fannie Mae, Freddie Mac?



bailed out in 2008, 
fannie mae 116 billion received, 132 billion paid back 12/30/14
freddie mac 72 billion received,  92 billion paid back 13/30/14


US treasury is doing it Putin style

Treasury is like Putin! Tells us one thing does another. Do you believe Putin too? Treasury is main beneficiary of Fannie and Freddys money, as a matter of fact the only beneficiary. What would you want them to say? The US treasury does not need to take fannies money, the US treasury prints money. Why do you think they need to take anyones money? Money is not a real thing, its paper that is given value by governments. Every extra dime Treasury gets back from F&F is one dime more than was ever needed printed. The Us treasury can print all the money fannie gives them plus 4 times that. It does not matter. Since the treasury controls the money that is printed in the US dollar, every dollar they get back is just 1 dollar more than they should have printed. It really is not even money fannie is giving to treasury, As treasury IS the printer and can print more or less at anytime. Think of the life of a dollar and you will see it is a holding pattern for Fake accounting. If fannie were giving money to you or I, then the money still has life. But to give the money to the printer really means nothing accept for extinguishing the life of that money. It really is circular. Anyway Putin lies and so does the US treasury. If i recall the new HUD guy just a month ago was saying to wind down fannie too, but just embraced affordable housing by watt. The two dont match up, One cannot wind down fannie and keep affordable housing. No private corporation will ever place their profits into affordable hosuing except fannie. No company would begin its life being under the FHFA’s thumb like fannie and freddie are. No private capital would show up for those terms. As everyone can see, this is true. No private capital has or will show up for the terms of FHFA and congress of lose everything or be taken over by the govt!! This is Fact and if you dispute it, you are either short F&F or you are a lie spreader working for shorts or the government itself. Putin style.

Friday, December 12, 2014

Fannie Mae Announces Risk Transfer Deal to Increase Role of Private Capital in Mortgage Market

Fannie Mae Announces Risk Transfer Deal to Increase Role of Private Capital in Mortgage Market


Fannie Mae has expanded its risk sharing offeringswith Wednesday's announcement of the credit insurance risk transfer (CIRT) deal, which transfers the credit risk on a pool of loans from the taxpayers to a panel of domestic reinsurers

The goal of CIRT is to reduce the risk to taxpayers by increasing the role of private capital in the mortgage market. The new deal also fulfills one of the 2014 Conservatorship Scorecard goals, which was to complete a variety of risk sharing transactions in addition to the Connecticut Avenue Securities (C-deals) series announced by Fannie Mae in October 2013.

"This unique transaction uses actual losses to calculate benefits, for which risk investors have expressed a preference,” said Andrew Bon Salle, EVP of single-family underwriting, pricing and capital markets at Fannie Mae. "This deal complements our current risk sharing offerings focused on capital markets investors and mortgage insurers, and we expect it will be a template for similar transactions that we may execute in the future.

The reinsurance market is an attractive potential source of private capital because it currently bears a small amount of U.S. residential mortgage risk. We are pleased to test new and innovative ways to diversify our risk sharing counterparties and to structure this deal in a manner that promotes efficiency and safety."

Fannie Mae is growing its products for mortgage investors.
After putting together several successful risk-sharing deals (see the list of coverage by clicking here), today the government-sponsored enterprise unveiled a new product.
The credit insurance risk transfer deal shifts credit risk on a pool of loans to a panel of domestic reinsurers.
The company said the offer is proof that Fannie Mae is diversifying the role of private capital in the secondary mortgage market. Earlier this week, the GSE launched a 3% down mortgage product.
“The credit insurance risk transfer deal shifts credit risk on a pool of loans to a panel of domestic reinsurers,” the company said in a statement.
“This unique transaction uses actual losses to calculate benefits, for which risk investors have expressed a preference,” said Andrew Bon Salle, EVP of single-family underwriting, pricing and capital markets.
Bon Salle said he expects CIRT will be a template for similar transactions Fannie may execute in the future.
“The reinsurance market is an attractive potential source of private capital because it currently bears a small amount of U.S. residential mortgage risk. We are pleased to test new and innovative ways to diversify our risk sharing counterparties and to structure this deal in a manner that promotes efficiency and safety.”
In CIRT-2014-1, Fannie Mae retains risk on the first 50 basis points of loss on a $6.419 billion pool of loans.
Fannie Mae also provided actual loss coverage for the next 300 basis points of loss on the $6.419 billion pool, up to a maximum coverage of approximately $193 million, should the former run out.
Duration is 10 years. However, the aggregate coverage amount may be reduced at the 3-year, 5-year and 7-year anniversaries from the effective date.

Director Watt Begins To Exercise His Administrative Authority

Director Watt Begins To Exercise His Administrative Authority


New programs by WATT 3% down and affordable housing, F&F need capital!!

Dont you see the narrative? F&F need capital to deal with these new programs. 
There is only one way for that to happen! Recapitalize them with private money.
Let them loose to market. investors will come. Holding them captive will not bring investors.
Just look at the problem being created and the talk in congress, Fannie is needs to be capitalized to protect the taxpayer! Even some of the lesser informed congressman who suggest the money has not even been paid back, not one dime they say, know that is a lie. Did they not read a paper in the last 2 years on how all the big banks had lied and committed fraud against F&F? Did they not see the large sums that the FHFA accepted from the DOJ lawsuits against them as settlement money? over $100 billion was collected in suits against the banks!
Do the leaders on the hill not get a paper anymore? Do the leaders on the hill believe that a loan should be made and 100% of your pay be taken from you forever? DO the leaders on the hill still believe the proven false narrative that F&F were the cause? Were they not alive when PLS crashed and bear sterns needed to be bought by 
JP morgan before it went bankrupt? Do the leaders on the hill not realize that The PLS market was the problem? Do the leaders on the hill know that fannie and freddie have never made a mortgage loan and it is the BIG banks that check credit worthiness of borrowers and then sell their loans to Fannie after that? Do the leaders on the hill know that if the banks cover up the bad loans with false information F&F could not know they are being robbed? Do the leaders in congress have a clue of the facts of why treasury used so much money to help goldman sachs when it was known at the time GS was about to go bankrupt along with morgan stanly? Why are so many GS people working and have worked at treasury in recent years? Why did GS and MS get 100 cents on dollar but Aig and F&F got the blame and the lie? Time to tell truths, we dont want the lies anymore. 

Sen. Richard Shelby (R., Ala.), incoming chairman of the Senate Banking on WATT

Sen. Richard Shelby (R., Ala.), incoming chairman of the Senate Banking
Quotes after Watts actions on Affordable housing funding by Fannie mae and Freddie mac.

said in a statement that it was “misguided” to restore money to the housing “slush funds.”
“FHFA’s decision to begin capitalizing the Housing Trust Fund and the Capital Magnet Fund from [Fannie and Freddie] is misguided,” he said. “With nearly zero capital protecting the taxpayer from losses, Fannie Mae and Freddie Mac are clearly not in the proper financial position to restore contributions to these slush funds. I strongly oppose [FHFA] Director [Mel] Watt’s decision and will continue to fight to protect taxpayers.”
and
House Financial Services Committee Chairman Jeb Hensarling said
"With nearly zero capital protecting the taxpayer from losses, Fannie Mae and Freddie Mac are clearly not in the proper financial position to restore contributions to these slush funds," Shelby said. "I strongly oppose Director Watt's decision and will continue to fight to protect taxpayers."

House Financial Services Committee Chairman Jeb Hensarling said Watt timed the move for the end of the 113th Congress "in a transparent effort to evade scrutiny and frustrate congressional oversight."

He vowed to call Watt to testify on the issue early next month.

"Diverting assets to housing trust funds instead of repaying taxpayers or stabilizing Fannie and Freddie's finances only makes matters worse," Hensarling said.
==========
Hensarling says, or stabilizing Fannie and Freddie's finances!!
As far as repaying taxpayers, we all know that song is over. F&F have paid back $50 BILLION more than they received!! I as a taxpayer am still waiting for my check in the mail for my payback from F&F!! Send each american their portion of the "repaying taxpayers" you speak of republicans! Ill take cash or check, your choice!
As for Sen. Richard Shelby, Fannie mae and Freddie mac has nearly zero capital because you allow the US treasury to TAKE 25 billion a year from the two and send it to the US General fund!!! This is known as the biggest slush fund on the planet!!! You and the FHFA and the Treasury are all responsible for F&F not having any capital. YOU and the FHFA and the Treasury can fix that, Release from conservatorship and allow them to keep THEIR MONEY!!!!!!!!!!!!

No Sense in Keeping the GSEs Undercapitalized

No Sense in Keeping the GSEs Undercapitalized

http://www.americanbanker.com/bankthink/no-sense-in-keeping-the-gses-undercapitalized-1071607-1.html

Treasury can — and should — take immediate corrective action to cure the undercapitalization of the GSEs. The Community Mortgage Lenders of America calls on the U.S. Treasury and the Federal Housing Finance Agency to restructure the payment terms of its agreement to enable the GSEs to retain a portion of their net earnings to rebuild their capital positions. There is neither a need nor a rational reason to wait on Congress to act, particularly since GSE reform legislation is far from certain.

Thursday, December 11, 2014

Geithner Aides Reaped Millions Working for Banks, Hedge Funds

Geithner Aides Reaped Millions Working for Banks, Hedge Funds


The advisers include Gene Sperling, who last year took in $887,727 from Goldman Sachs and $158,000 for speeches mostly to financial companies, including the firm run by accused Ponzi scheme mastermind R. Allen Stanford. Another top aide, Lee Sachs, reported more than $3 million in salary and partnership income from Mariner Investment Group, a New York hedge fund.
As part of Geithner’s kitchen cabinet, Sperling and Sachs wield influence behind the scenes at the Treasury Department, where they help oversee the $700 billion banking rescue and craft executive pay rules and the revamp of financial regulations.

For those that are not grasping it!!! Watt is for the poor.

For those that are not grasping it!!! Watt is for the poor.

Watt was a member of black caucus. Watt will Not leave the FHFA before fannie and freddie are released!
He Cannot be removed by the new senate as he is appointed by the president and confirmed by the senate. He is in until the next president appoints a new FHFA regulator.
He has placed affordable housing back on the goals of the democrats, and believe they will release F&F before they lose affordable housing to any bill or any other republican president.
FHFA and FHFA alone will decide the fate of conservatorship, IT is the law. Read HERA.
This means Watt will decide!
If a republican becomes president, Watt will be out.
Will the dems leave the affordable housing to a republican that certainly will remove them? I think not.

Watt: “Financial Operations of Fannie Mae Have Stabilized To A Sufficient Level”

Watt: “Financial Operations of Fannie Mae Have Stabilized To A Sufficient Level”



Republicans blast FHFA plan to restart contributions to housing trust fund

Republicans blast FHFA plan to restart contributions to housing trust fund


republicans:
Rep. Randy Neugebauer (R-Texas), chairman of the House Financial Services Subcommittee on Housing and Insurance, said he was "outraged" at Watt's decision and said the "timing could not be more suspect."
"Recent history should serve as a reminder that failed government housing policy can have catastrophic consequences for hardworking American taxpayers and the overall health of our economy," he said.
This is déjà vu all over again. Director Watt may have forgotten the path of destruction left by the GSEs, but the American people have not."
Fannie and Freddie needed about $190 billion to stay afloat during the financial crisis. Congress has yet to agree on a plan that would bring them out of conservatorship and reduce the risk for taxpayers.
"Contrary to what Fannie and Freddie apologists claim, the GSEs have yet to repay any of the taxpayer-funded bailout funds they received, which makes today's announcement by the FHFA outrageous. Money coming in from the GSEs should go to the taxpayers instead of a slush fund for ideological housing groups to play around with," said Rep. Ed Royce (R-Calif.), a member of the Financial Services panel who has worked on the issue. 
Sen. Bob Corker (R-Tenn.), a member of the Senate Banking Committee, called the decision “beyond irresponsible to restart these affordable housing allocations without first dealing with the underlying problems at Fannie Mae and Freddie Mac."
"These two entities would not be generating one penny of revenue without taxpayer backing, and until the American taxpayers are taken off the hook for a future bailout, FHFA should continue to suspend payments to these funds," Corker said. 

democrats:
But Democrats said it is time to take steps to help families in need. 
Rep. Maxine Waters (D-Calif.), ranking member of the House Financial Services Committee and co-author of legislation that created the fund, praised the announcement
"In the richest country in the world, it is unconscionable that there are 7.1 million American households for whom safe and decent housing is neither affordable nor available," she said.  
By allocating a tiny percentage of Fannie Mae and Freddie Mac’s profits to these funds, we have the chance to improve the lives of millions of American children, families, people with disabilities and the elderly."
Several Democractic senators — Jack Reed (R.I.), Barbara Boxer (Calif.), Elizabeth Warren (Mass.) and Bernie Sanders (I-Vt.) — called the  move "a smart step toward strengthening our economy and increasing the supply of affordable rental housing across the country."
"It will allow more renters to find the homes they need at prices they can afford and will help with economic development initiatives in low income or rural areas,” Reed said.
Housing and Urban Development (HUD) Secretary Julián Castro hailed the decision and said it "will help people across the nation secure a decent place to call home."

WATT just did 2 out of 3 of things the senate banking committee told him to do

Maybe you don’t see it but WATT just did 2 out of 3 of things the senate banking committee told him to do just a week ago!!
1. principal reduction
2. lower down payment and affordable housing goals
3. end conservatorship
1 and 2 are now DONE!.. You think closing the doors is next? HA!
I bet 3 is next! Democrats run the show on FHFA and housing until 2017!
And they have done the more in a week, than the past 6 years, after losing the senate. Affordable housing will never be handed over to republicans in 2017! Believe that!

The Web continues Brian Brooks. New Fannie vice president

http://www.nationallawjournal.com/legaltimes/id=1202674030022/Former-OMelveny-MP-Named-Fannie-Maes-New-GC

Fannie Mae announced Monday that a former bank executive and managing partner at a Washington law firm will join its leadership.
Brian Brooks will take over as executive vice president, general counsel and corporate secretary on Nov. 10 2014, according to a news release. Brooks has been serving as vice chairman and chief legal officer at OneWest Bank in Pasadena.

Brooks received his law degree with honors from the University of Chicago, and holds a BA in Government from Harvard University from which he graduated cum laude.

“I can see him (Brian brooks) being excited about helping Fannie Mae build a strong housing finance system,” O’Melveny chairman Brad Butwin said. “He’s really smart, good on policy, plays well with others.”
In 2010, Brooks represented former Federal Reserve Chairman Alan Greenspan and others during Financial Crisis Inquiry Commission hearings, a bipartisan panel tasked with teasing out causes of the financial collapse of 2008.

http://www.wsj.com/articles/SB121321030258665089

June 12, 2008
WASHINGTON -- Democratic Party stalwart James A. Johnson quit as an adviser to the Barack Obama campaign, where he was helping to screen potential running mates, as new details emerged about loans Mr. Johnson received from mortgage lender Countrywide Financial Corp.
Mr. Johnson, who led mortgage buyer Fannie Mae from 1991 to 1998
In a statement, Sen. Obama said, "Jim did not want to distract in any way from the very important task of gathering information about my vice presidential nominee, so he has made a decision to step aside that I accept."

A Democratic power broker who remains a paid consultant to Fannie Mae, Mr. Johnson was a major beneficiary of a Countrywide program known as "Friends of Angelo," which arranged loans for friends of Chairman and Chief Executive Angelo Mozilo at attractive rates.

A lawyer for Mr. Johnson, Brian Brooks, said the former Fannie Mae chief is a client of Countrywide's "private mortgage banking" division, which caters to wealthy customers. He said Mr. Johnson never sought special treatment. "He submitted applications in the normal course like anyone else would," he said.

12 U.S. Code § 4612 - Minimum capital levels

12 U.S. Code § 4612 - Minimum capital levels

Fannie mae would need about 20 billion in capital to meet this requirement!
They have that in their pockets and more, right now, today.

(a) Enterprises
For purposes of this subchapter, the minimum capital level for each enterprise shall be the sum of—
(1) 2.50 percent of the aggregate on-balance sheet assets of the enterprise, as determined in accordance with generally accepted accounting principles;
(2) 0.45 percent of the unpaid principal balance of outstanding mortgage-backed securities and substantially equivalent instruments issued or guaranteed by the enterprise that are not included in paragraph (1); and
(3) 0.45 percent of other off-balance sheet obligations of the enterprise not included in paragraph (2) (excluding commitments in excess of 50 percent of the average dollar amount of the commitments outstanding each quarter over the preceding 4 quarters), except that the Director shall adjust such percentage to reflect differences in the credit risk of such obligations in relation to the instruments included in paragraph (2).

Reasonable projections indicate that Fannie Mae will remain profitable for the foreseeable future

http://www.fhfa.gov/Media/PublicAffairs/Documents/FNM_HTFCMF12112014.pdf

While the profit levels Fannie Mae has experienced since 2012 are not expected to be
sustainable, reasonable projections indicate that Fannie Mae will remain profitable for the
foreseeable future and FHFA continues to monitor the financial condition of Fannie Mae and
retains the authority to revise or reverse this decision at any time in accordance with the
provisions of Section 4567(b ).

Regulator directs Fannie, Freddie to fill affordable housing fund

2/27/14

Should Fannie and Freddie Fund Housing for the Poor?



The Affordable Housing Trust Fund is empty because shortly after Congress set it up in 2008, the companies that were supposed to fund it -- Fannie Mae and Freddie Mac -- were seized by the government. 
“We saw that Fannie and Freddie were both coming back, in fact roaring back, and all this money was going to the federal Treasury and there was just no justification for not putting aside some of that money, which at this point is so small compared to the amount that has gone to the Treasury,” said Charles Elsesser, a Florida legal aid lawyer who filed the suit on behalf of the National Low Income Housing Coalition.
Democrats:
Now that the mortgage financiers are posting record profits, it’s time to reverse that decision, a group of 33 U.S. senators wrote in a January letter to Melvin L. Watt
Republicans:
Fourteen Republican senators sent Watt a letter yesterday asking him not to allow contributions to the trust fund. “If Watt is going to fulfill promises he made during the confirmation process to protect taxpayers, he will continue the common sense suspension of contributions
Then Today 12/11/14!
WASHINGTON, Dec 11,2014 (Reuters) - Fannie Mae and Freddie Mac's regulator on Thursday directed the two government-controlled mortgage firms to begin setting aside money for an affordable housing fund established in 2008.
Federal Housing Finance Agency Director Mel Watt said in letters to the two firms that it was appropriate to roll back a suspension of payments into the fund given their return to financial health.
========
This will eliminate some law suits against the FHFA. 
This will be hard to reverse now. 3% down is IN, affordable housing is IN, Mortgage principal reduction is IN. The only thing left is Release from conservatorship. 
By doing all these controversial things before the new congress can work on Housing the FHFA has predetermined the route to take, by trying to write these out of the new law, the law will not pass. There is NO WAY to keep these things in policy as DEMOCRATS want, without risking turning FHFA and treasury over to Republicans in 2 years and have it all reversed.
THERE IS ONLY ONE WAY, RELEASE FROM CONSERVATORSHIP. It is the only way. 
Federal Housing Finance Agency Director Mel Watt said in letters to the two firms that it was appropriate to roll back a suspension of payments into the fund given their return to financial health.
Seems like there is only one thing left to do, since their return to financial health?
Kill them! LMAO just kidding. That is the story we have heard for years. Ask yourself does that even seem to be reality? shutter the companies that support 3% down and affordable housing? What about kill the two corps that did not run away in 2007-2009 as PLS went to zero participation? There would be no mortgages if this was private back in 2007-2009. Fannie and Freddie saved the USA.
Fannie and Freddie have returned to Financial Health, a prerequisite to release from conservatorship. This may be the first time FHFA has said they are returned to Financial Health!

Wednesday, December 10, 2014

Fannie and Freddie will always be here and have always been shareholder owned during conservatorship


  • Fannie and Freddie are now doing 3% down loans.
  • Fannie and Freddie are competing with FHA loans, but are doing it cheaper, with less upfront money for same loan. Also FHA loans add to your loan amount right off. 100k loan is 102k at FHA. At Fannie its 100k.
  • Fannie and Freddie can only think of this 3% down stuff. FHFA regulates them and tells them they have to do it, and they do have to do it, as part of law.
  • Banks would never take such a low down payment, Nor would they risk the costs associated with foreclosure on such a low down payment. 
  • Banks DO NOT have to give 3% down loans if Fannie or Freddie were eliminated. They are not Regulated by FHFA and CAN NOT be forced to give such loans. They are Free companies and they would never offer such terms. 
  • Since banks would never offer such terms and it seems it would be the only way to get housing moving, the FHFA told fannie and freddie to do it. 
  • At 20% down the USA real estate market is D.O.A.
  • At 10% down the USA real estate market is D.O.A.
  • At 5% down the USA real estate market is D.O.A.
  • At 3% down the USA real estate market may grow? The above is why the FHFA has enacted 3%
  • By shutting down Fannie and Freddie you turn the mortgage market and real estate into D.O.A.
  • Fannie and Freddie are here to stay. You can bank on it. You can bet 95% surety that by the next election F&F will be free and the mortgage market will No longer be in the FHFA hands. 
  • Government is not meant to run companies, Government certainly is not meant to TAKE 100% from private shareholders. Would shareholders of Apple or Ford or JP Morgan or Goldman Sachs like the terms of F&F? NO! Then why would the government think anyone would deal with them on a new housing structure when its obvious the government will take all YOUR capital at its whim.  

3% Down Conventional Loans Are Here For Real

3% Down Conventional Loans Are Here For Real


http://www.forbes.com/sites/markgreene/2014/12/09/3-down-conventional-loans-are-here-for-real/

First time homebuyers can now in fact put as little as 3% down and get conventional financing (no longer confined to the FHA only box). There are no prohibitive restrictions; in fact if two people are buying a home, only one of them need be a first time buyer.

This is a significant mortgage financing event and should bring more first time buyers into the active home buyers’ pool.

Enter 3% down payment conventional mortgage financing and the landscape changes dramatically. Conventional financing does not handcuff borrowers to mortgage insurance forever like FHA MIP does

And let us not forget about that upfront FHA MIP insurance which is 1.75% of the loan amount added to the loan. So a $200,000 FHA loan would actually start at $203,500 ($3,500 for the upfront MIP). I did not make that up, go look it up for yourself!
By the way, conventional PMI (Private Mortgage Insurance) has no upfront PMI, never has.


Monday, December 8, 2014

PRICE TARGETS 24 month

PRICE TARGETS 24 month:

$2.50 NOTHING HAPPENS 
$4.00 Sweeny case moves forward to discovery, NO stay
$7.00 trial begins
$20.00 Fairholm and watt settle out of court. sweep removed and all money paid back.
$20.00 Fairholm wins case
$1.00 Fairholm loses and has to go to Appeal.
$5.00 Lamberth trial overturned 
$2.00 Lamberth trial not overturned
$10.00 congress decides on bill to keep fannie & freddie
$20.00 congress passes bill to keep fannie & freddie
$60.00 Obama signs bill to keep fannie & Freddie
$2.00 congress tries to wind down fannie yet again
$1.00 congress passes a bill to wind down fannie
$0.25 cents, Obama signs the bill to wind down fannie
$20.00 watt releases F&F
$60.00 watt releases F&F and warrants are torn up
$2.00 Aig starr loses case
$20.00 My personal target for half my shares.
$60.00 plus for the other half.

In Next 24 months fannie will have a price range between
$0.25 cents and $60 dollars. You decide how much you want to lose or gain.
Good luck.