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Is a Fannie and Freddie settlement near? Richard X. Bove
White House lawyers recently asked a federal court to grant them access to documents in the case between Fairholme Funds and the United States over Fannie Mae and Freddie Mac.
I think the unusual request suggests that the White House may be moving closer to a negotiated settlement in the multiple Fannie Mae lawsuits which will benefit shareholders in this company, the largest of whom is the U.S. taxpayer.
Read MoreDick Bove: Dodd-Frank was a disaster
Fairholme owns a large stake in Fannie Mae and Freddie Mac and its case, brought with several other large investors, alleges that the government took profits from Fannie and Freddie unjustly and diverted them to the Treasury, violating the Fifth Amendment. That states that you can't take private property for public use "without just compensation."
The defendants in the Fannie and Freddie lawsuits are the United States Treasury Department and the Federal Housing Finance Agency. These agencies have asserted that they need not produce over 10,000 documents in this lawsuit due to presidential (executive) privilege. Moreover, massive portions of the documents that have been produced have been redacted and not made available to the public for the same reason.
The fact that three White House counsels now want to take a look at these documents suggests that the White House was probably not aware of what the Treasury and FHFA were doing in the name of executive privilege and without the White House ever seeing the documents in question.
Read MoreDick Bove: Thank you, Marco Rubio
In my view there are two other reasons why the White House now wants to see the documents that were claimed to be privileged:
1) The recent stock-market plunge stems, in part, from fears that the global economy may be weaker than thought. Some definitive action needs to be taken in this country to assure investors that this supposed weakening is not happening here.
2) Several civil-rights organizations, including the NAACP, according to my sources, have approached the White House requesting some help for low-income households that have been shut out of the housing market by the administration's directives for tighter lending standards.
Stated simply: The White House needs Fannie and Freddie to go back to work to do what they were meant to do in the first place – i.e., assist the nation's housing markets to stimulate economic growth. Settling these cases would accomplish just that.
Read MoreBove: Liquidity posing 'massive' market danger
Commentary by Richard X. Bove, an equity research analyst at Rafferty Capital Markets and the author of "Guardians of Prosperity: Why America Needs Big Banks" (2013).
http://www.cnbc.com/2015/08/28/bove-fannie-and-freddie-settlement-near-commentary.html
Is a Fannie and Freddie settlement near? Richard X. Bove
White House lawyers recently asked a federal court to grant them access to documents in the case between Fairholme Funds and the United States over Fannie Mae and Freddie Mac.
I think the unusual request suggests that the White House may be moving closer to a negotiated settlement in the multiple Fannie Mae lawsuits which will benefit shareholders in this company, the largest of whom is the U.S. taxpayer.
Read MoreDick Bove: Dodd-Frank was a disaster
Fairholme owns a large stake in Fannie Mae and Freddie Mac and its case, brought with several other large investors, alleges that the government took profits from Fannie and Freddie unjustly and diverted them to the Treasury, violating the Fifth Amendment. That states that you can't take private property for public use "without just compensation."
The defendants in the Fannie and Freddie lawsuits are the United States Treasury Department and the Federal Housing Finance Agency. These agencies have asserted that they need not produce over 10,000 documents in this lawsuit due to presidential (executive) privilege. Moreover, massive portions of the documents that have been produced have been redacted and not made available to the public for the same reason.
The fact that three White House counsels now want to take a look at these documents suggests that the White House was probably not aware of what the Treasury and FHFA were doing in the name of executive privilege and without the White House ever seeing the documents in question.
Read MoreDick Bove: Thank you, Marco Rubio
In my view there are two other reasons why the White House now wants to see the documents that were claimed to be privileged:
1) The recent stock-market plunge stems, in part, from fears that the global economy may be weaker than thought. Some definitive action needs to be taken in this country to assure investors that this supposed weakening is not happening here.
2) Several civil-rights organizations, including the NAACP, according to my sources, have approached the White House requesting some help for low-income households that have been shut out of the housing market by the administration's directives for tighter lending standards.
Stated simply: The White House needs Fannie and Freddie to go back to work to do what they were meant to do in the first place – i.e., assist the nation's housing markets to stimulate economic growth. Settling these cases would accomplish just that.
Read MoreBove: Liquidity posing 'massive' market danger
Commentary by Richard X. Bove, an equity research analyst at Rafferty Capital Markets and the author of "Guardians of Prosperity: Why America Needs Big Banks" (2013).
http://www.cnbc.com/2015/08/28/bove-fannie-and-freddie-settlement-near-commentary.html
thanx for invite/ fed lying again/ revised g.d.p. from under 2's to high 3's
Great day today, must say. x aks wynn fnma fmcc hov loco wtw mtw mdbx
hey, hey hows the toast master. hope all are making bank today on the volatility. TVIX been great, got a new pet penny ECDP. I'm ready for a good winner ~ need an excuse to hit the Wynn this fall GLTU/A
rocco
Why I Support Reforming the GSEs, Not Eliminating Them
Posted on August 21, 2015 by DavidHStevens
A lot has been said on the subject of Fannie Mae and Freddie Mac. Many speeches have been given, articles written, and op-eds published on the subject of how to resolve the unsustainable conservatorship. Like others with opinions, I have one too.
As background, I worked at Freddie Mac for the better part of a decade in the late 90s/early 2000s, overseeing the company’s Single Family business. I later served as the Assistant Secretary of Housing and Federal Housing Commissioner in the midst of the housing crisis and the nation’s worst recession since the Great Depression. I’ve also worked for lenders large and small – I’ve been involved in this housing finance system from all sides.
Today, I run the Mortgage Bankers Association. We have over 2,000 institutions representing banks, credit unions, community banks, independent mortgage bankers and service providers all involved in financing commercial, multifamily, and residential real estate, both rented and owned. No matter any outcome, our members will finance every property in the nation. I am not saying I own exclusive rights to the correct view, but I am saying my opinion is well informed.
I want to also clarify something. I am not a shareholder of either company and not involved with any of the lawsuits around shareholder’s rights. Importantly, I am truly indifferent to the shareholder cause. Whether the lawsuits succeed or fail, I only care about the long term viability of a vibrant and sustainable housing finance system.
The most important element here is to recognize that conservatorship is not a long term solution, and in the current state may be the riskiest position of all. The GSEs do not have the capital to withstand the next housing downturn and the taxpayers do not want to be on the hook again if the companies falter. Setting a long term pathway forward that offers structural reforms to the current companies and their operations, ends the conservatorship and opens the door for new entities to possibly compete with the legacy GSEs, is absolutely critical for our next President and Congress and should be a part of the candidates’ platforms.
I am not calling for the elimination of Fannie Mae and Freddie Mac. I’m advocating for reform of Fannie and Freddie as part of re-envisioning the government’s role in the mortgage market, keeping in mind the following principles:
The role the GSEs play in supporting an affordable and sustainable housing finance system is absolutely critical to this nation. The GSEs take large numbers of home mortgages originated by lenders, put them into government-guaranteed mortgage backed securities and sell them to investors around the globe. This function provides a steady flow of capital to the US housing market and ensures the availability of the 30 year fixed rate mortgage for American homebuyers in all geographies of the country.
Some might argue that this function could be replicated by other parties, private capital alone, or some new model. The fact is we need some form of government entity in the mortgage market. Investors don’t like uncertainty – this why the vast majority of them will not buy any mortgage security that is not explicitly backed by the US Government.
Under their original charters, prior to their collapse, the GSEs operated with an “implicit” guarantee. While the US Government bailed them out once, there is absolutely no certainty this would happen again. For that reason, if these two companies were simply released from conservatorship, with nothing more than the implicit guarantee, mortgage rates for American homebuyers would inevitably rise as investors around the globe would not trust that the US Government would bail them out if anything were to happen again.An implicit guarantee vs. an explicit one is a big deal – and it’s why I believe that any exit from conservatorship has to involve legislation to establish an explicit guarantee behind these mortgage bonds. In short, the GSEs cannot be rolled back out with their former implicit guarantee and to get an explicit guarantee requires an act of Congress.
Protecting the infrastructure of Fannie Mae and Freddie Mac should be a priority, because any transition to a new system will need to retain and redeploy key aspects of the GSE’s current systems and talented employees. Why reinvent the wheel and start from scratch when you already have so many of the necessary pieces in place?
Reforming the GSEs will require revising their charters, confirming the role of a firm regulator, and either releasing them from conservatorship or establishing new corporate identities. The companies have no capital, and until exiting from conservatorship will be subject to intrusive Congressional intervention, like the recent efforts to try to pay for other unrelated legislation via new fees charged on mortgages and restrictions on executive compensation.
Allowing these two companies to continue supporting the system must also come with a new charter that maintains the bright line between the primary and secondary mortgage markets, limits their portfolios and restricts the products they can buy to core, sustainable mortgages, all in an effort to ensure they best serve the broad housing market and can never again make the mistakes that contributed to the housing crash.
The GSEs in any new system should have a clear mission. Prior to conservatorship, the GSEs had misaligned incentives. As companies that operated with an implicit government guarantee, Freddie Mac and Fannie Mae could operate with an enormous market advantage and use that advantage to extend their reach far beyond the original intent of their founders. As shareholder-owned, private companies, the relentless drive for returns and to compete fueled all sorts of bad decision making, which fed their massive portfolios with subprime, alt-a, and other unsustainable products.
In the end, the drive to benefit shareholders and to compete with other market players was paid for by taxpayers when the government was forced to bail them out. The government funneled close to $200 billion into them and then helped nurse them back to health via programs like QE, HAMP, and HARP; federal programs that allowed homeowners to refinance at low, subsidized rates, or modify their mortgage if they were in trouble.
Any future system should price mortgages based on actual credit risk and not market share or unsustainable credit risk trades. The GSEs grew far too fast on unsustainable programs often fueled by their portfolios and credit waivers.
The quest for market share drove these companies to give sweetheart pricing deals and credit waivers to lenders that could deliver more business in exchange for exclusivity. Just these elements – pricing and credit waivers and special deals – created significant advantages for some lenders, making it really difficult for small banks, credit unions, independent mortgage bankers to compete. It forced many to sell their loans to aggregators instead of directly to the GSEs. And when it all collapsed, many that had the sweetest deals of all, led the fall.
To move this effort forward, we need to resolve what needs to be fixed.
Reduce risk to the taxpayer by having the explicit guarantee back only the mortgage securities and not corporate entities. The U.S. Government should charge a reasonable fee in exchange for this guarantee.
Fix the incentive conflict by limiting what businesses Freddie and Fannie can engage in. Eliminate the GSE retained portfolios for all but a few specific short term programs to support the cash windows and multifamily aggregation prior to sale into the markets.
Eliminate the competitive difference between the Fannie Mae and Freddie Mac mortgage securities. Creating one single security will both enhance market liquidity of the security and put Fannie and Freddie into a more balanced market position. It will also more easily allow for the entry of additional entities in to the system, should Congress move in that direction.
Reduce differences in data disclosure and improve transparency and investor confidence in the mortgage securities by adopting a common securitization platform. This will also allow for new entities to more easily enter the system and could also be used by the private securitization market.
Ensure the American taxpayer is at risk only in the event of a catastrophic market collapse by deepening the level of responsible private capital taking first loss risk in their transactions.
Ensure a robust supply of affordable rental housing by maintaining the GSEs’ multifamily programs.
Finally, with a strong regulator, establish clear policies about how the GSEs sustainably serve lower and moderate income earners in a manner that is effective, but also does not contribute to any future housing crisis.
Clearly, this is not a simple issue and everything I have laid out here warrants a far more robust discussion, including the appropriate role of government in the housing market, a debate that should include the proper size of the conforming loan limits and the multifamily caps. At my organization, the MBA, we have laid out extensive position papers on most of what I have discussed here. While this involves changes to their charters, their governance, and some operational improvements to reduce risk and improve liquidity, it’s a future that would keep what most Americans want to protect — the thirty year fixed rate mortgage — and continue a liquid flow of capital into all U.S. mortgage markets.
Get in IGEX GOLDEN CROSS AND EPIC RUN LIKE VIIC BUT BETTER COMING
IJJP- can get summertime cheapies and see it fly by October, recently reduced float, only 21,000 debt with 450,000 cash, many projects in the works, many bashers, but could pop if we get above .0005
Watching USO UWTI X AKS SID MTL GSI HOV SUNE GRPN LL LOCK BUFF...
looking at the 3 month chart on fidelity active trader pro....I may enter at .001 if I have the time to do some dd.
Wow, thanks...TEX jumped 21%...wished I had that one.
Detearing did you see this???? I know you like construction companies it was a late pr.. Look at that dividend over a buck....
Terex and Konecranes to Combine in an All-Stock MergerDate :08/11/2015 @ 2:00AMSource :Business WireStock :Terex Corp. (TEX)Quote : 21.83 0.99 (4.75%) @ 8:00PM
Terex and Konecranes to Combine in an All-Stock Merger
Print
Alert
Terex (NYSE:TEX)
Intraday Stock Chart
Today : Tuesday 11 August 2015
Combination of Two Highly Complementary Businesses to Create a Global Leader in Lifting & Material Handling Solutions
Creates an industry leader with expected $10.0 billion in pro forma 2014 revenueResults in a stronger more competitive global lifting and material handling companyExpected to be accretive to both companies' shareholders in first full yearIdentified annual after-tax synergies of at least $119 millionNew Company plans to authorize a $1.5 billion share repurchase and initial annual dividend of approximately $1.15 per share
only 40% up in today intraday session...since 0.21 bottom alert... ;)
low low volume for this PPS range... tic toc.. fins are coming so the real reversal..:))
ASTI
IGEX ACTIVE STATUS IGEX ~!~! KAAABOOOOOMM Tomorrow!!!
http://nvsos.gov/SOSEntitySearch/CorpDetails.aspx?lx8nvq=MXW64%252bGGjzirMqNqFUR0%252fA%253d%253d&nt7=0
you'd be surprised.. it went 8% down market open yesterday.. and took off 12% up intraday.. to settle @ 0.23... IMO is looking/retesting the 0.21 bottom now.. and ready to take off
fundamentaly sound.. good company!!
asti
Looks like if your short, you been winning...longs, ah, not looking good.
ASTI @ 52wksLOW nice vol lately http://www.finviz.com/quote.ashx?t=asti&ty=c&ta=1&p=d
Huge amounts of basher and shorters in IGEX
Gold looking good...watching.
But I like FNMA FMCC X AKS WYNN.
Take a look at IGEX Great DD on there and I suggest a look as we are building a lot of interest and will be the FIRST OF ASIA to have a trading Platform like Scottrade and fidelity is in the USA
Great day today!
AKS SID X
WTW
FNMA
HOV
MTW
FNMA FMCC WYNN Big wins...
FNMA X FMCC WYNN HOV AKS WTW LOCK HEMP MDBX
Gold 900? Watching dollar strength.
WYNN AKS X
WTW SWHC
Watching adding...
I don't see American Airline posts supporting claims of huge success. What you see on that board were panicky players fleeing near the bottom.
Should mention that I bought it at the exact low and sold at the precise high... long ago. Yeah ME! Everyone follow my trades!!!!
I can always toast on winning distressed stocks. AAMRQ I made around 3000%. XIDEQ was my last distressed stock and busy running my corporation. I am buy and hold and only do around 20 trades a week vs. 100 a day. My toast is what I have won and what I plan to win in the future. Now I win mainly in my corp.
I have recently restarted a position in AAL and RUTH.
What's to toast???
Certainly not EXIDEQ!
Bad call on RSH. Off about 75% since then
"I do like RSH ELRA..."
Exide idiot players got killed in the cancellation.
Toast at Wynn this Sunday to Tuesday night for ICSC convention.
Actually it takes 10 years to come off someones credit report. The 7 years is what it takes before you can file a chapter 7 BK again.
I hold BAA. Charts good.
My big green today...X WYNN AKS
Hello King Long
Have a look at BAA charts if interested.
Cheers
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=113260646
Added to WYNN just below $109's...X in $23.8
Today WYNN and X sharply declined...I will add more of both and continue to hold...these are long term positions. I did listen to most of the Wynn conference call and will call back to finis it.
AKS earnings look good...X and WYNN report AH today...
Big green early gains on AKS X SID...oil USO recovering and .DXY finally broke support...dollar dropping, oil will gain and bring my steel sector stocks to pop, IMO. X AKS earnings out tomorrow.
Housing prices increased 5% from a year ago so FNMA FMCC HOV KBH and other housing stocks will recover...my bet.
WYNN earnings out Thursday AH.
FNMA FMCC are my long term favorite stocks with most potential upside for distressed stocks.
I remain positive on my steel sector stocks and casino stocks as well. I have around 100 stocks.
X AKS SID MTL GSI...AA
WYNN LVS MGM PENN CZR CACQ BYD
bigger green day than yesterday...X AKS USO SID SWHC CZR
Big green today. X AKS ICA MTL SID USO
FNMA FMCC Warm Up Toast - LAS VEGAS, NV - TOAST AT WYNN
Parasol Up
April 17
7 PM to 8 PM
PM me if you want to attend.
Badabing...dd is king and I like the way you think!
Hey detearing I heard some reports that the housing might be getting alot busier... The foreclosures that happen awhile back are ready to get back in... 7 yrs is all it takes to be off their record and some figures are suggesting that they are getting back in... That would help the market construction and loan market...
FnF...been in for a while, not always with a smile...bolden holden until golden...politicians trying to steal the profits but Ms. Justice will have her day and restoration of FnF is around the corner...that has always been my bet...
FNMA FMCC will be my best long term investments ever, IMO. I am predicting the future of course, yet, that is my gut feeling...
I hope everyone on the list is still holding at least a minimum core.
FNMA FMCC LONG LIST WILL BE LOCKED AT FIVE BUCKS.
This is the latest FNMA and/or her brother Long List. Please let me know if you see anything that needs to be corrected. I am looking for FnF Longs to hold their core holdings until FnF is restored. I will PM a very special invitation to the Wynn FnF Restoration Celebration Toast, which will be a memorable toast event of a lifetime. If you just notified me this past weekend, please remind me as I did not have the list with me...thanks! There may be some on this list with less than 20,000 shares, but have made significant DD contributions and positive posts in support of LONGS. $FNMA FMCC
1M shares and up – Diamond; Platinum 75 and up; 50k shares and up – Gold; 20k shares and up – Silver; less than 20k - Bronze.
1. 1AAA Platinum
2. 3antar
3. 888888888 Gold
4. 8mileshigh Silver
5. 10bambam Platinum
6. 4Duxs
7. Ackman Diamond
8. Ada
9. Adamzx717
10. Adhuntr
11. AlwaysInStock
12. Alwayswondering
13. Andydub Gold
14. Armstka Bronze
15. Ayatollahrocknrolla
16. AugWest Bronze
17. Beetlejuice
18. Biscayne62 Gold
19. blanka General 1,000,000 points
20. Berkowitz Gold
21. BigBenWallace
22. Bigstocksnbonds Bronze
23. BigWill Bronze
24. Bostonsesco Bronze
25. brharris
26. Buffett Diamond
26.5 Casey VP26 Silver
27. Cate Gold
28. CatBirdSeat Platinum
29. Celtic Bronze
30. Chessmaster315
31. Charlie1988
32. Chosenuno
33. Clearday
34. cldubu Bronze
35. Cobra Khan
36. Condor65 Silver
37. Conkster49 Bronze
38. Cooler_Heads Silver
39. Corktown Bronze
40. cw24cents
41. Dabeav Bronze
42. Dadx4
43. Darrell00 Gold
44. Danno cal
45. David 302
46. Dick Bove Platinum
47. Demar
48. Detearing Platinum
49. Dollars1
50. DuckDynasty Gold
51. eleckp Bronze
52. Fanniefreddieforever
53. Feralcomprehension
54. Filmoepro Gold
55. Financialwin Platinum
56.
57. FNMA0die-hard Platinum
58. garderlafoi
59. GetRich1Day
60. GergeFa Gold
61. Godinez77 Silver
62. Grassi Bronze
63. Green2013
64. GreenWizard Bronze
65. Gswill
66. Harleydude22 Silver
67. hbmetalman Gold
68. Hessapts Platinum
69. Hollyk Bronze
69.5 Hotpick Gold
69.5 hvpatel
70. Icahn Diamond
71. Il Padrino Gold
72. illegal_alias Bronze
73. Implication Bronze
74. ItsMyOption Platinum
75. Is1240 Bronze
76. Jbeach Bronze
77. J-Bear GOLD
78. Jacked
79. Jarenawer Platinum
80. JAWZZ GOLD
81. JEDIDIAH
82. JeddieMack
83. Jestiron
84. Jmb0173 Platinum
85. Joesocc1 Platinum
86. John Deere 1 Platinum
87. judypudy Bronze
88. Kabanch GOLD
89. Karpito
90. Kicks66 Gold
91. Kingdmc Gold
92. Kingu1ysnmbr1 Silver
93. LasNubes
94. LGJ letgojoe Bronze
95. Lens Cleaner Gold
96. Letgoofmyfannie Platinum
97. lollybella Silver
97.5 Louise Rafter Platinum
98. Lookaheadfuture GOLD
99. Lubberboy
100. Lumpina
101. Milton Waddams Bronze
102. m285 Gold
103. maclorjoe Silver
104. Malebaboon
105. Mathan22 Silver
106. McInc
107. Mdran1
108. Melly4
109. Mike usa
110. MPowerKai Silver
111. Mrj25 Platinum
112. Mt69sinai Bronze
113. MsCoffeenut Bronze
114. myogenix Platinum
115. Nader Platinum
116. Navycmdr
117. Nitwit
118. Nocluetrader
119. Nogoodtrader Bronze
120. Nomonet Bronze
121. nvpickle Gold
122. Obiterdictum
123. Onemanband
124. 1956 Packard Gold
125. Patrick821 Gold
126. PatriotFan
127. pauldc1066 GOLD
128. Penny chaser 22K @ 1.81
129. Pharaoh-1
130. philster812 Bronze
131. PinkBu
132. QueenVic Bronze
133. Ranger425
134. ReadyToRumble
135. RecreationalPlayer
136. Redscud Bronze
137. Redsolocup Platinum
138. Reyprimero
139. RickNagra Platinum
139.5 RISK IT Gold
140. Roacher GOLD
141. Robpad Bronze
142. rocco2
143. Rockie Gold
144. Sage4
145. Santana10
146. Simple22
147. Sittingduck
148. Skidoo31
149. Shopgirl Bronze
150. Sillysisi Silver
151. SLJB
152. Slob
153. Snapple Silver
154. Soundguy Bronze
155. Stevelwr1
156. Stockprofiter Platinum
157. Straightline Gold
158. Strykerd
159. Surfonium Gold
160. SurrealPhoton
161. Sworksmax
162. Taty Platinum
163. Tkallls
164. The Shadow Gold
165. TheWhale
166. Timster
167. Thexsandos Gold
168. TKane Bronze
169. Travel5
170. Traybaby
171. Usmcvet
172. Victor Newman Bronze
173. wcharlie Gold
174. Wesdawg
175. Woven Oxygen Bronze
174.5 WildTwins Bronze since 2013
175. Zargis
176. Zazookaz Silver
177. Zephadiah
178. ZOH Silver
Today's Winners: XIDEQ 42%; PVSP 11%; EKSO 10%; NEWL 6.67%; MTL 5.6%; KBH 3.21%; HOV 2.8%
BIG GREEN FOR ME: X AKS MTG ICA MTL MNTX KBH
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