Thursday, April 9, 2015

Dick Bove Calls Out WSJ for Bad Math on Fannie (FNMA), Freddie (FMCC) #Fanniegate

Dick Bove Calls Out WSJ for Bad Math on Fannie (FNMA), Freddie (FMCC)


Bove's latest report is entitled "Can John Carney Count?"
1+1=2


$246 paid, $189 received. Actually F&F only Received $135 and paid $100 billion in interest(profit)
OR:
$416 paid, $189 received. Actually F&F only Received $135 and paid $300 billion in interest (profit)

In either case, the US TREASURY has Taken from 80% profit to 250% profit in 6 years!
The 80% would be well over 10% a year, the 250% would be well over 25% a year! 
This on top of Fannie Mae and Freddie Mac never needing a bailout in the first place, the TBTF banks needed a bailout by transferring bad loans to F&F (gse's). HARP and HAMP programs did just this!
Point is Fannie Mae is a Rape victim and the Rapists are still in full Rape mode. 
Pitiful! #Fanniegate

Wednesday, April 8, 2015

America's mortgage-insurance giants are making bigger profits than before the crisis

America's mortgage-insurance giants are making bigger profits than before the crisis

Fannie Mae and Freddie Mac
Never been better

America's mortgage-insurance giants are making bigger profits than before the crisis
Feb 20th 2015 | LONDON AND NEW YORK | Business and finance

http://www.economist.com/news/business-and-finance/21644525-americas-mortgage-insurance-giants-are-now-making-bigger-profits-financial-crisis

Looking at the headlines, it may seem that both Fannie and Freddie are in financial trouble again. On February 19th Freddie Mac reported a sharp decline in its net income last year, which fell from $48.7 billion to $7.7 billion. The next day Fannie Mae also announced a big fall in earnings. Falling market interest rates forced the pair to declare losses on the derivatives they hold as a hedge against rising rates, although these should recover the lost ground if, as expected, the Federal Reserve starts to raise rates later this year.


The fact remains that both Fannie and Freddie have emerged from the financial crisis churning out more profits before tax than they ever have before (see chart). Who benefits most from this is a subject of controversy. The government, having bailed out Fannie and Freddie in 2008, owns most of the pair. Other shareholders own 20%, but Barack Obama’s administration in effect expropriated these stakes in 2012: virtually all earnings now go to the Treasury.

ex·pro·pri·ate
ˌeksˈprōprēˌāt/
verb
past tense: expropriated; past participle: expropriated
  1. (especially of the state) take away (property) from its owner.
    "government plans to expropriate farmland"



Blogger: (me)
The key takeaway from this is Fannie and Freddie will continue to give smaller and smaller checks to the treasury as long as interest rates stay low! So Q1 2015 is over now and we will see Fannie mae and Freddie mac pay even less again than they just paid for Q4 2014! Why? They are hedging against falling rates, which will not happen! Rates are at all time lows and will not go lower! What happens if they stay same? Fannie and Freddie will keep their hedges and on paper make less money. But if rates go up they can (out of thin air) make more money! These hedges are all part of the plan the FHFA has for the twins. The FHFA calls all the shots and allows them to either send HUGE sums to treasury or allows them to HIDE the profit!

2015 will be the year of HIDE the profit, at the direction of the FHFA conservator! Interesting? I think so.

Charles Grassley Questions Diversion of Fannie and Freddie Earnings: NY TIMES

Charles Grassley Questions Diversion of Fannie and Freddie Earnings


http://www.nytimes.com/2015/04/08/business/charles-grassley-questions-diversion-of-fannie-and-freddie-earnings.html?_r=0

This is pretty interesting!


By GRETCHEN MORGENSONAPRIL 7, 2015

Charles Grassley is asking why the government kept a lid on bailout repayment documents. Credit Drew Angerer/Getty Images

For almost two years, shareholders of Fannie Mae and Freddie Mac have been asking the United States government about its 2012 decision to divert all of the mortgage finance giants’ earnings to the Treasury rather than let them repay taxpayers under the original bailout agreement.

But the government has declined to disclose documents relating to that decision, contending that some may be subject to presidential privilege.

Now, this cloak of secrecy has drawn the scrutiny of Charles E. Grassley, the Iowa Republican who is chairman of the Senate Judiciary Committee. On Tuesday, Mr. Grassley sent letters to the Justice Department and the Treasury asking for details about the decision and why the government has kept such a tight lid on documents relating to it.

“The taxpayer has a right to know what has transpired,” Mr. Grassley wrote in letters to both Eric H. Holder Jr., the United States attorney general, and Jacob Lew, the Treasury secretary. “But, instead of transparency, there appears to be an invocation of executive privilege. If true, this is cause for concern.”

Tim has letter here:
https://timhoward717.files.wordpress.com/2015/04/grassleylettertodoj.pdf

The taxpayer has a right to know what has transpired. But, instead of transparency, there
appears to be an invocation of executive privilege. If true, this is cause for concern.
Accordingly, please provide the following:
1. Has the President personally invoked executive privilege over documents related to the
Fannie Mae, Freddie Mac and Treasury Third Amendment agreement? If so, when? If
not, why are DOJ attorneys citing that privilege as a reason to withhold those documents?
2. Does the Third Amendment cause a breach of any of FHFA’s statutory duties to ensure
that each regulated entity operates in a safe and sound manner? Please explain.
3. During the negotiation of the Third Amendment between Treasury and FHFA, did DOJ
communicate with any of the entities involved regarding its legality? If so, please
describe those communications in detail.
4. Under what legal authority was the Third Amendment authorized?
5. Prior to litigation, did DOJ discuss with Treasury and/or FHFA the need to assert
privileges, including executive privilege, over certain documents?