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Preferreds going SUPER NOVA +32.23%, +17.34% & +33.61% !!!
Christmas coming EARLY to GSEs
FANNIE $3.00 X $3.01 ... 201,200 premkt !!!!
FREDDIE $2.94 X$2.96
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pre-mkt Freddie BID X ASK = $2.92 X $ 2.94
pre-mkt FANNIe BID X ASK = $2.98 X $2.99
pre-mkt Level II ... Freddie ASK now $2.94 !! 
Freddie _+.00
1st Fannie TRADE ...
Fannie $2.98_ +.02
Hensarling signals breakthrough in mortgage reform
Watt is seeking to avoid that draw in part
because it would also suspend payments to an
affordable housing trust fund.
...
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By LORRAINE WOELLERT 12/06/2017 03:34 PM EST
House Financial Services Chairman Jeb Hensarling (R-Texas) said his comprehensive mortgage reform bill, the Path Act, is unlikely to become law and that he has begun reaching out to Democrats and others to begin work on bipartisan legislation.
“While I personally have not changed my principles or my mind, and I still believe the best path forward is the Path Act, I do not see the Path Act’s passage likely,” Hensarling said. “I stand ready to negotiate with an open mind.”
The statement is a breakthrough in mortgage reform, which has languished since the 2008 housing collapse in part because of Hensarling’s insistence that the government exit the business of guaranteeing mortgage-backed securities.
Hensarling said it is politically inevitable that any reform package will include a government guarantee of mortgage bonds like those issued by Fannie Mae and Freddie Mac, the government-backed enterprises that were bailed out after the housing collapse. The companies are currently wards of the state, devoid of capital and reliant on a $258 billion taxpayer lifeline they might need to tap as early as next year.
"I don’t want a government guarantee, I don’t think we need a government affordable housing program but in surveying the political landscape I know they will exist in any bipartisan effort," Hensarling told POLITICO. "At the end of the day I'm here to make progress."
Speaking at a conference sponsored by the National Association of Realtors and S&P Global, Hensarling endorsed a plan from the Milken Institute authored by Edward DeMarco and Michael Bright. DeMarco, former acting director of the Federal Housing Finance Agency, now leads the Housing Policy Council at the Financial Services Roundtable. Bright is executive vice president at Ginnie Mae, the government corporation that stands behind mortgages backed by the Federal Housing Administration, Department of Veterans Affairs and Department of Agriculture.
"If you're going to have a dumb policy, this is at least a smart way to do it," he told POLITICO after his speech.
“I personally continue to believe that a government guarantee in the secondary mortgage market is a bad idea, a risky and an unneeded idea,” Hensarling said at the conference. “Any government guarantee must be limited to catastrophic losses.”
He has reached out to the committee's top Democrat, Rep. Maxine Waters of California. Reps. Sean Duffy (R-Wis.) and Emanuel Cleaver (D-Mo.) are also working on ideas, he said.
Separately, he criticized efforts by FHFA Director Mel Watt to retain capital for Fannie and Freddie, which currently send their profits to Treasury under a contract known as the net worth sweep. If Congress cuts the corporate tax rate, as expected, the companies would have to write down the value of their deferred tax assets, triggering a loss that would force them to seek taxpayer help.
Watt is seeking to avoid that draw in part because it would also suspend payments to an affordable housing trust fund.
"It is unfathomable we would stop a full sweep to benefit taxpayers in order to continue to fund an affordable housing trust fund," Hensarling said. "That’s untenable."
In the Senate Banking Committee, mortgage reform is taking longer than expected as lawmakers explore new ideas for rebuilding Fannie and Freddie, Sen. Heidi Heitkamp (D-N.D.) said.
Chairman Mike Crapo (R-Idaho) had put reform of the government-sponsored entities, or GSEs, on a short-list of priorities, but the timeline has been pushed back, Heitkamp said at the NAR conference.
“GSE reform has gotten complicated, new ideas are percolating and developing,” she said. “The chair originally had said he wanted to do GSE reform first, but I think that got to be too complicated because the ideas were too new.”
Earlier proposals from Sens. Bob Corker (R-Tenn.) and Mark Warner (D-Va.), and from Crapo and former South Dakota Sen. Tim Johnson, which sought a broad restructuring of the mortgage system, have been set aside, Heitkamp said.
“I don’t think it’s going to be early next year,” she said. “We’re all going to try to push very hard to make sure this is a bipartisan agreement.”
So yesterday the Twins were RED most of the day
then ... they BOTH rebounded to even near the close ...
Ya think ... this NEWS jus maybe had sumpin to do ith it ???
Fannie-Freddie Overhaul Plan Comes Into Focus on Capitol Hill
By Joe Light December 6, 2017, 4:39 PM PST Updated on , 1:00 AM PST
-- Corker-Warner "would keep Fannie-Freddie " but create competitors
-- Key House Republican acquiesces to explicit mortgage guarantee
Congress still has a long way to go before resolving the most significant overhang that remains from the 2008 financial crisis. But a consensus is emerging around principles for overhauling Fannie Mae, Freddie Mac and the U.S. mortgage-finance system.
Bob CorkerPhotographer: Andrew Harrer/Bloomberg
Senators Bob Corker and Mark Warner have been working on a bill for months, and they intend to start sharing ideas and legislative text with other senators and the Trump administration in the coming weeks, said people familiar with the matter. Their plan would preserve Fannie and Freddie but take steps to make it easier for investors or other companies to create competitors, the people said. The two lawmakers want to introduce a bill by early next year.
Fannie and Freddie Died But Were Reborn, Profitably: Quicktake
https://www.bloomberg.com/quicktake/fannie-mae-and-freddie-mac-irbtxzdk
Such a move would begin what’s sure to be a drawn out and contentious process to address one of the most critical components of the U.S. economy. Fannie and Freddie provide the grease for the housing market by guaranteeing nearly $5 trillion in mortgage bonds. Reforming the companies will likely have broad implications for consumers’ borrowing costs and the availability of home loans.
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Senator Mark Warner, a Democrat from Virginia.Photographer: Andrew Harrer/Bloomberg
“Reforming our nation’s housing finance system is the last major piece of unfinished business of the financial crisis,” Corker, a Tennessee Republican, said in a Wednesday statement to Bloomberg. “We are engaged in productive discussions with our colleagues, the administration, and a number of stakeholders on the best path forward.”
Government Guarantee
The new effort comes as a key Republican lawmaker, House Financial Services Chairman Jeb Hensarling of Texas, said Wednesday he’s open to a government guarantee on some mortgage bonds. In a speech at an event in Washington, Hensarling said he still didn’t like the government having wide involvement in mortgage bonds but grasps the political reality that reform probably would not progress without one. That move from Hensarling, who previously disavowed any government guarantee, could make some Democrats more open to proceeding with an overhaul.
Fannie and Freddie were taken over by the government in 2008 and eventually received $187.5 billion in bailout money after the housing market cratered. Lawmakers and regulators initially said their fates would be resolved quickly, but instead the companies have been stuck in government control for more than nine years.
Read More: Fannie-Freddie Watchdog Stokes Quiet Fight With White House
https://www.bloomberg.com/news/articles/2017-11-29/for-fannie-freddie-watchdog-a-quieter-battle-with-white-house
Fannie and Freddie are a central component of the U.S. mortgage market, buying loans from lenders, wrapping them into securities and making guarantees to investors in case borrowers default. That process frees up cash for lenders to make more mortgages.
Before the crisis, in part because they were chartered by the federal government, investors believed the bonds they issued carried an “implied” government guarantee if Fannie and Freddie themselves went under.
Lawmaker Frustration
Many lawmakers derided that situation, asserting that the system meant that private Fannie-Freddie investors made money in good times, while the government had to bail them out in bad times. Many of the Fannie-Freddie reform plans that have been released since have sought to address that issue, though none have gotten enough traction to become law.
The proposal from Corker and Warner, a Virginia Democrat, would attempt to address that central quandary. It would put an explicit guarantee from the federal government on mortgage bonds issued under the new system, provided by Ginnie Mae for a fee. Ginnie, which is a government-owned corporation, already provides such a guarantee for mortgage bonds containing loans backed by the Federal Housing Administration and other agencies.
Fannie, Freddie and any new competitors would be required to have enough capital to pass stress tests, similar to what the government mandates for big banks. The companies also would be encouraged to offload some of the risk they take on to private investors, which Fannie and Freddie already do to some extent. Behind that backstop would be yet another layer of protection: A new government fund, meant to protect taxpayers in the event of a mortgage-finance company failing.
Senate Banking Committee Chairman Mike Crapo, an Idaho Republican, a few other senators and some members of the Trump administration have been kept abreast of the broad strokes of what Corker and Warner are working on.
Taxpayer Protections
Corker in an interview said that the goal of his and Warner’s plan will be to keep rates and the mortgage system unchanged for borrowers, while increasing taxpayer protection and competition in the secondary-mortgage market.
Under the proposal, preferred shareholders of Fannie and Freddie could be made whole or close to it, depending on the final outlines of the transition, the people said. But common shareholders may not fare as well, they said. Whether and how shareholders get compensated in the transition to the new system is still an open question. Investors in the companies include several prominent hedge funds.
This isn’t the first time Corker and Warner have tried to deal with Fannie and Freddie. A few years ago, the pair helped author legislation that would have wound down the companies and replaced them with an entirely new system. That bill foundered after opposition from some affordable housing advocates and small lenders.
“One of the lessons I learned from the last Corker-Warner effort was that our proposal was too complex, and didn’t do enough on affordability,” Warner said in a statement. “So what we’re looking for now is a viable simplified approach that protects the taxpayer, preserves the 30-year fixed mortgage, and includes robust access and affordability provisions.”
The new plan would require Fannie, Freddie and the other guarantors to offer small lenders access to the mortgage system on equal terms to large lenders, the people said. Corker and Warner are attempting to work with affordable housing advocates and more progressive senators to ensure mortgages are available to low-income borrowers, the people said.
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