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Actually that is their plan...since they are in control...at least until a judge spanks them...they will continue to suck the profits out of FnF for as long as possible...then it will be yet another battle to get that money back...if possible. By then..."they" will be long gone from the picture and retired with "their" taxpayer paid salaries.
Usury and the law
anyone have any ideas or thoughts...anything that may show how this might be a benefit to us?
I could well be pizzin up a rope, but something to take a look at.
"When money is lent on a contract to receive not only the principal sum again, but also an increase by way of compensation for the use, the increase is called interest by those who think it lawful, and usury by those who do not."
United States
In the United States, the primary legal power to regulate usury rests with the states. Usury laws are state laws that specify the maximum legal interest rate at which loans can be made. Each U.S. state has its own statute which dictates how much interest can be charged before it is considered usurious or unlawful.
If a lender charges above the lawful interest rate, a court will not allow the lender to sue to recover the debt because the interest rate was illegal anyway. In some states (such as New York) such loans are voided ab initio.[43]
On a federal level, Congress has never attempted to federally regulate interest rates on purely private transactions, but on the basis of past U.S. Supreme Court decisions, arguably the U.S. Congress might have the power to do so under the interstate commerce clause of Article I of the Constitution. Congress opted to put a federal criminal limit on interest rates by the Racketeer Influenced and Corrupt Organizations Act (RICO Statute) definitions of "unlawful debt", which make it a federal felony to lend money at an interest rate more than twice the local state usury rate and then try to collect that "unlawful debt".[44] It is a federal offense to use violence or threats to collect usurious interest (or any other sort) (Extortionate Credit Transactions statute, chapter 42, title 18, U.S. Code). Such activity is referred to as loan sharking, but that term is also applied to non-coercive usurious lending or even to the practice of making consumer loans without a license in jurisdictions that require licenses
I doubt it...he isn't smart enough
Fannie Mae and Freddie Mac Just Made Another $1.5 Billion -- But Shareholders Won’t See a Dime
By Matthew Frankel
February 28, 2015
http://www.fool.com/investing/general/2015/02/28/fannie-mae-and-freddie-mac-just-made-another-15-bi.aspx
Source: Futureatlas.com
Fannie Mae (NASDAQOTCBB: FNMA ) and Freddie Mac (NASDAQOTCBB: FMCC ) recently reported their 12th consecutive quarterly profit, but thanks to the conditions of their 2008 bailouts none of this money will make its way into shareholders' pockets.
Promising results from both agencies
For the fourth quarter, Fannie Mae and Freddie Mac reported earnings of $1.3 billion and $227 million, respectively. For the year, the agencies produced a combined net income of $21.9 billion.
As part of the bailout arrangement, however, all of Fannie and Freddie's profits go directly to the U.S. Treasury. Combined, the agencies received nearly $188 billion from the U.S. Treasury, so it makes sense that the government wants to be paid back, right?
The only thing is that the government has been paid back -- sort of. As of March, Fannie and Freddie will have sent more than $228 billion to the Treasury, or about $40 billion more than the original cost of the bailout. But here's the thing: the payments to the Treasury are considered "dividends" and have no effect on the outstanding balance of the bailout funds.
As you might imagine, shareholders aren't thrilled about this, with hedge-fund managers Bill Ackman and Bruce Berkowitz even suing the government to try to change the terms of the deal.
Will shareholders ever get paid?
It's hard to make a case that the shareholders shouldn't get paid here. After all, many of them bought shares several years ago when Fannie and Freddie were hemorrhaging money and were left for dead by most experts. Now that the agencies have turned things around, shouldn't they reap some rewards?
Ackman, who is Fannie and Freddie's largest common shareholder, made the case that by returning the companies to the shareholders and allowing them to build up their capital levels, it could be a win-win for shareholders as well as the government. In a recent presentation, Ackman made the case that shares could be worth from $23 to $47 (about eight to 17 times their current value), and that the government -- which holds warrants for about 80% of Fannie and Freddie -- could see $600 billion in returns over time, much more than they can expect by simply diverting the profits.
Finally, one thing that concerns shareholders and government officials alike is the potential need for further bailouts if the current arrangement continues. Not only are all profits diverted to the Treasury, but Fannie and Freddie are required to reduce their capital reserves by $600 million per year. Each company currently has reserves of $1.8 billion, which will be completely depleted by 2018.
Should you invest?
I'd definitely agree with the assertion that Fannie and Freddie (as well as the shareholders) would be better off if they were allowed to operate like any other publicly held company. And it appears that public and professional opinions may be shifting in favor of the shareholders, especially after the potential for another bailout was mentioned.
However, this is still a gamble, and a lot of things need to go right before shareholders would ever see a dime. Furthermore, bear in mind that many "big time" investors -- namely, Ackman and Berkowitz -- still have small positions in Fannie and Freddie relative to their other investments and can afford to take the risk.
My instinct tells me that ordinary investors should stay away, as I'm not one to take on such high-risk investments. Those investors who can stomach the risk and ensuing legal and political drama may indeed be rewarded, but as a glance at the agencies' share price tells us, it still isn't very likely.
Matthew Frankel has no position in any stocks mentioned since he doesn't like risky investments, but does have a mortgage guaranteed by Fannie Mae. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
Dax1...read the underlined portion at the bottom...this may clear it up for you.
H.R.2435
Latest Title: Let the GSEs Pay Us Back Act of 2013
Sponsor: Rep Capuano, Michael E. [MA-7] (introduced 6/19/2013) Cosponsors (None)
Latest Major Action: 6/19/2013 Referred to House committee. Status: Referred to the House Committee on Financial Services.SUMMARY AS OF:
6/19/2013--Introduced.
Let the GSEs Pay Us Back Act of 2013 - Directs the Secretary of the Treasury, the Federal National Mortgage Association (Fannie Mae) and any affiliate, and the Federal Home Loan Mortgage Corporation (Freddie Mac) and any affiliate (government sponsored enterprises or GSEs), with each GSE acting through an appointed conservator, to enter into an agreement that modifies the Preferred Stock Purchase Agreement for the GSE to provide that: (1) any Senior Preferred Stock purchased under the Agreement by the Treasury shall not accrue further dividends; and (2) any amounts received by the GSE, before or after the modification, during a single year as a draw upon the Treasury's commitment under the Agreement shall be treated as a loan by the Treasury to the GSE meeting specified criteria.
Specifies as such criteria that this loan be treated as though originated on the date of the last such draw during that year, with: (1) an original principal obligation equal to the aggregate amount of such draws, (2) a 30-year term, (3) an annual interest rate of 5%, and (4) requirements for full amortization of the loan over the 30-year term. Requires the GSE to repay the loan in accordance with the amortization schedule established.
Requires any dividends paid by the GSE to the Treasury under the Agreement before the modification to be treated as payments of principal and interest due under the loan, to be credited against payments due: (1) first to the loan with the earliest origination date that has not yet been fully repaid until it is repaid, and (2) then to the loan having the next earliest origination date until it is repaid.
Since this letter is over a a year and a half old, do we know...or does anyone know...if Lew responded? If he did...is that information public/available?
TIA
Reply from my Congressman. Wow, I guess we know where he stands
This came from Yahoo msg board. It's obvious some of our political leadership still has a death wish for FnF.
*************
STEVE STIVERS
15th District, Ohio
FINANCIAL SERVICES COMMITTEE
February 20, 2015
Mr. Me
Dear (wnu09):
Thank you for contacting me regarding the Federal Housing Finance Agency's (FHFA) conservatorship of Fannie Mae and Freddie Mac. I appreciate the opportunity to respond to you.
Fannie Mae and Freddie Mac as Government Sponsored Enterprises (GSEs) are huge liabilities for the U.S. taxpayer. As a member of the House Committee on Financial Services Committee, I have worked to support legislation and signed onto letters that call for fiscally-sound housing policy and proper risk management.
With our national debt at $18 trillion, we simply must end the bailouts of the past, especially given that the GSEs were the most expensive government bailout in the history of the United States. The Financial Services Committee, last year advanced a bill to rein in Fannie Mae and Freddie Mac, specifically H.R. 2767, the Protecting American Taxpayers and Homeowners Act of 2013.
H.R. 2767 would appoint FHFA as receiver of Fannie Mae and Freddie Mac to carry out mandatory receivership, thus terminating the current conservatorship and the total profit sweep by Treasury. I supported this bill when it was voted out of the Financial Services Committee, however it was not acted upon by the full House before the end of the 113th Congress.
Please be assured I will continue to keep your concerns in mind as this and other similar legislation moves forward in the 114th Congress.
Again, thank you for sharing your views with me. Please do not hesitate to contact my office if I may be of assistance in the future. For additional information on where I stand on the policies and issues before Congress, please sign up for my e-newsletter at: www.stivers.house.gov. You can also follow me on Facebook, Twitter and YouTube.
Sincerely,
Steve Stivers
Member of Congress
The guy is an imbecilic sociopathic low level crook that was way too caught up with himself and is exactly where he needs to be. Unfortunately he will get out much too soon.
I believe the "original" plan for Fannie and Freddie was for them to be used as scapegoats for the banks' corruption. Then...as time went on and they accumulated more and more toxic loans from the banks, the political machines from both sides of the aisle would have plenty of "work" to do to try and remodel/remold/fix Fannie and Freddie over the next 10 - 15 years so the taxpayers would forget about who were really the bad guys in all this.
With Fannie and Freddie turning such huge profits and paying back...or at the point of being able to pay back all monies "borrowed" in a few short years...it caught both sides of the aisle with their hands in their pants....or the bankers pants...or each others pants.
Current as of Feb. 11, 2015
Bailout Recipients
Fannie Mae
RECEIVED FROM TAXPAYERS - $116,149,000,000.00 BILLION DOLLARS
TOTAL REPAID TO DATE - $134,435,000,000.00 BILLION DOLLARS
Profit to the Taxpayer - 15.74357 % - 18.286 BILLION DOLLARS
Fannie Mae has paid $6.6711 BILLION dollars OVER the 10% dividend to date.
Freddie Mac
RECEIVED FROM TAXPAYERS - $71,336,000,000.00 BILLION DOLLARS
TOTAL REPAID TO DATE - $90,969,000,000.00 BILLION DOLLARS
Profit to the Taxpayer - 27.52187 % - 19.633 BILLION DOLLARS
Freddie Mac has paid $12.4994 BILLION dollars OVER the 10% dividend to date
AIG
RECEIVED FROM TAXPAYERS - $67,835,000,000.00 BILLION DOLLARS
TOTAL REPAID TO DATE - $72860967492.00 BILLION DOLLARS
Profit to Taxpayer - 07.40911 % - 5.025 BILLION DOLLARS
GM
RECEIVED FROM TAXPAYERS - $50,744,648,329.00 BILLION DOLLARS
TOTAL REPAID TO DATE - $39,334,175,747.00 BILLION DOLLARS
GM Still OWES the Taxpayers $11.41 BILLION DOLLARS.
***Keep in mind these numbers are NOT 100% accurate due to the fact I took in to consideration ONLY the bailout amount and 10% dividend. I did NOT take into account multiple years for the 10% dividend payment. So we can assume a modest few % points lower on actual overage values.
I've been here since 2008...patience is pretty easy over a 3 day weekend...lol. We may find some good news trickle out before tuesday which could move this a lot higher on speculation...then hopefully we move back towards and above that $6+ area.
today was a good day...let it fly...lol
Ackman: We Need to Recapitalize Fannie and Freddie
http://www.bloomberg.com/news/videos/2015-02-12/ackman-we-need-to-recapitalize-fannie-and-freddie
Pershing Square's Ackman says bullish on Fannie, Freddie
http://finance.yahoo.com/news/pershing-squares-ackman-says-bullish-230121584.html
By Svea Herbst-Bayliss
NEW YORK, Feb 12 (Reuters) - Hedge fund titan William Ackman said on Thursday that U.S. mortgage financing giants Fannie Mae and Freddie Mac are a bet he likes a lot.
"It is the most interesting risk-reward that I am aware of in the capital markets right now," Ackman said at the Harbor Investment Conference when asked to discuss his investement in the the two companies.
Ackman's Pershing Square Capital Management ranked as last year's best peforming hedge fund with a 40 percent return. The hedge fund first made a bet on the mortgage companies in late 2013.
Don't know if anyone has posted this yet
By
John Carney
Feb. 8, 2015 2:17 p.m. ET
5 COMMENTS
What a difference four years makes. In 2010, the Fairholme Fund had $18.8 billion under management and its manager, Bruce Berkowitz, celebrated its 25.5% annual gain with effusive praise for the government.
“Over the past few years, Fairholme’s performance is due in large part to thousands of patriots in civil service who rescued the global financial system with much intelligence and hard work, demonstrating government at its best during a time of national crisis,” Mr. Berkowitz wrote in his annual investor letter.
As of November, the fund had shrunk to $6.8 billion. And Mr. Berkowtiz’s most recent letter strikes a different tone, attacking “Washington bureaucrats” for abusing executive power, acting unconstitutionally, and expropriating “two of the most valuable companies in the world,” namely Fannie Mae and Freddie Mac .
Fairholme leads a shareholder suit seeking to dislodge the government’s right to all of the two mortgage giants’ profits. Investors accompanying Fairholme explicitly or implicitly in its battle should beware.
With the fund losing 2.72% last year while the S&P 500 index gained 13.69%, Fairholme’s change of mood is understandable. Less so is Mr. Berkowitz’s claim that the government is putting Fannie’s and Freddie’s profits into a “piggy bank.” It is simply not the case that all of their capital is spent on “executive branch prerogatives.” Rather, the dividends remitted by them to the Treasury are spent in the same way as nearly all of the federal government’s general revenue. That is, in accordance with laws passed by Congress and signed by the president. That basic error about the fate of Fannie’s and Freddie’s funds raises questions about how well Fairholme understands the dynamics affecting the two firms that together make up around 8.7% of its holdings.
This year hasn’t begun on a promising note for those betting on a radical change in Fannie’s and Freddie’s situation boosting their stocks. In late January, a federal judge in Iowa dismissed a shareholder suit at the very moment Mr. Berkowitz was holding an investor call. Days later, the president’s 2016 budget stated that his policy is to eliminate the companies, bluntly declaring they “should be wound down.” Not the most emphatic buy signal.
Write to John Carney at john.carney@wsj.com
This is very telling
A fundamental question at the heart of the case — whether the government had the power to demand stock as a condition of the loan — was largely covered in the trial’s first two weeks, during testimony by the top lawyers for the Fed and the New York Fed, and by Paulson, Geithner and Bernanke.
In a preliminary ruling in the case in 2012, Wheeler wrote that he didn’t accept the government’s position that the Fed’s emergency powers allowed it to demand stock from a company.
Under questioning by a government lawyer, Scott Alvarez, the general counsel for the Fed testified that he concluded the board of governors could empower a reserve bank “to extend credit and in giving that authorization can set whatever limits and restrictions and rules the Federal Reserve Board believes is appropriate,” including demanding equity.
The emergency powers clause at issue doesn’t specifically mention equity, only that that Fed can set an interest rate for emergency lending.
According to a Starr filing yesterday, the documents Wheeler ordered the government to turn over include correspondence showing that regulators doubted their authority to demand stock as part of the loan deal,
“The government is on thin ice and they know it,” a Davis Polk lawyer wrote to colleagues. “But who is going to challenge them on this ground?”
Sharpton getting pass on taxes due to Obama connections?
watch the video
http://finance.yahoo.com/video/sharpton-getting-pass-taxes-due-032340385.html
AW,,,try this
U.S. Toll-Free Dial-In:
(855) 477-7449
Conference ID: 72458059
Look at post 283194...I took a snapshot of that accnt and posted it.
MB...check this out...do you think it's a hack job?
https://twitter.com/MelvinWatt
Mel Watt's Christmas Gift To ACORN And Democrats
12/30/2014 06:12 PM ET
LINK:
http://news.investors.com/ibd-editorials/123014-732671-obama-orders-fannie-freddie-to-set-aside-housing-slush-fund.htm#disqus_thread
Cronyism: The Obama regime has quietly ordered Fannie Mae and Freddie Mac to start donating hundreds of millions of dollars a year to a permanent affordable-housing slush fund for Democratic activist groups.
Earlier this month, while few were paying attention, Federal Housing Finance Agency chief Mel Watt sent letters to the mortgage giants to "set aside in each fiscal year 4.2 basis points of each dollar of unpaid principal balance of new business purchases to be allocated to the Housing Trust Fund and the Capital Magnet Fund."
That's a 0.042% tax to equip the funds. HUD will run the housing fund; the Treasury Department will run the capital fund.
If the funds had been operating in 2010, when Fannie and Freddie together bought $856 billion in new mortgages, Fannie and Freddie would have pumped a whopping $360 million into the funds. Estimates put their total for fiscal 2015 at half a billion dollars.
The money will help build apartments for extremely low-income Americans, says Watt, the former Congressional Black Caucus leader whom President Obama hand-picked to regulate Fannie and Freddie. The funds will also help the poor afford their own homes through down payments and other assistance.
But nonprofit housing activist groups will distribute the funds. So count on money being diverted to ACORN fronts and clones, beholden to the Democratic Party, who in the past have laundered housing grant money to finance political campaigns.
As we've reported previously, ACORN affiliates are still operational in New York and other cities, having renamed themselves after ACORN was busted for fraud and corruption during the 2008 presidential campaign. They're also still receiving HUD housing grants.
In the past, these groups have used HUD grants to pressure banks to make ill-advised home loans that sped the mortgage crisis. Now a permanently funded war chest will aid their shakedown — courtesy of taxpayers still on the hook for Fannie and Freddie.
The last thing the nation needs is another Washington scheme that further politicizes the lending and home-building markets. Yet rest assured that will be the end result of these national housing funds.
Making matters worse, they're unaccountable to congressional appropriators, making them ripe for corruption and cronyism. We're talking about billions of dollars funneling through left-wing nonprofits and floating around in urban reinvestment projects sponsored by the likes of Rahm Emanuel and Al Sharpton and Jesse Jackson.
With this potential $500 million slush fund, moreover, the Obama regime is effectively turning Fannie and Freddie into off-budget welfare agencies — indeed, a self-sustaining shadow government for the left wing that will survive even Republican administrations.
Now we know what the president really had in mind when he promised to "reform" the bankrupt mortgage giants.
Read More At Investor's Business Daily: http://news.investors.com/ibd-editorials/123014-732671-obama-orders-fannie-freddie-to-set-aside-housing-slush-fund.htm#disqus_thread#ixzz3QECNifpb
Follow us: @IBDinvestors on Twitter | InvestorsBusinessDaily on Facebook
did not Watt early in this pointedly state that FHFA is NOT answerable to Treasury/ this administration/ congress...that FHFA is INDEPENDENT FROM THE POLITICAL MACHINE.....then when Mr. Hinojosa questioned him about wind down/ release...he states it is NOT up to him...but to congress...did I hear this correctly?
New Paper Shows Conservatorship of Fannie Mae and Freddie Mac Does Not Comply with the Law
Michael Krimminger and Mark Calabria, who advised on the drafting of HERA in 2008, to Present White Paper Findings on Investors Unite Teleconference on Thurs, Jan 29 at 9:15am EST
Business Wire
Investors Unite 2 hours ago
WASHINGTON--(BUSINESS WIRE)--
On Thursday, January 29th at 9:15am EST, Mark A. Calabria of the Cato Institute and Michael Krimminger, Partner at Cleary Gottlieb, will release a new paper which explains how the U.S. Treasury Department and the Federal Housing Finance Agency (FHFA) have breached both the spirit and the letter of the law in their administration of the conservatorship of Fannie Mae and Freddie Mac.
The authors of this paper were intimately involved in the policy discussions that led to the creation of the 2008 Housing and Economic Recovery Act (HERA), which allowed for Fannie Mae and Freddie Mac to be placed into conservatorship. Mr. Calabria served as the senior professional staff of the U.S. Senate Committee on Banking, Housing and Urban Affairs, and Mr. Krimminger served in policy leadership positions with the FDIC. While with the FDIC, Mr. Krimminger served in a number of roles including as FDIC general counsel and Deputy to the Chairman for Policy.
Investors Unite Executive Director Tim Pagliara will host the media teleconference and Calabria and Krimminger will present their new analysis and will be available for questions from the media.
To join the teleconference, please RSVP to media@investorsunite.org. Those who RSVP will receive an advance copy of the paper’s executive summary ahead of the call.
WHO:
Tim Pagliara, Investors Unite Executive Director and CapWealth Advisors Chairman and CEO
Mark A. Calabria, Director of Financial Regulation Studies at the Cato Institute and Former Senior Staff of the U.S. Senate Committee on Banking, Housing and Urban Affairs
Michael Krimminger, Partner at Cleary Gottlieb and Former General Counsel for the Federal Deposit Insurance Corporation (FDIC)
WHAT:
Media Teleconference: Mark Calabria and Michael Krimminger Release White Paper on Conservatorship under HERA
WHEN:
Thursday, January 29th at 9:15am EST
DIAL IN:
877-876-9177; Conference ID: HERA
RSVP:
Please RSVP to media@investorsunite.org
About Investors Unite: Formed by Tennessee investor and CapWealth Advisors Chairman and CEO, Tim Pagliara, Investors Unite (investorsunite.org) is a coalition of over 1,400 private investors from all walks of life, committed to the preservation of shareholder rights for all invested in Fannie Mae and Freddie Mac. The coalition works to educate shareholders and lawmakers on the importance of adopting GSE reform that fully respects the legal rights of Fannie Mae and Freddie Mac shareholders and offers full restitution on investments.
Contact:
Investors Unite
866-288-3537
info@investorsunite.org
Letter to Government leadership.
First and foremost I want to point out that I am NOT a writer by any means....I would welcome any and all corrections, re-writes, better and more concise verbiage, logical processes, quality information, more pertinent info, pretty much anything that would be temperate and supportive...and accurate...for our overall goal of informing our political leaders we want and need the GSE's released from conservatorship.
My goal was to be accurate and deliberate, portray common sense and common needs without adding 30+ pages of dry info we know they won't read. Let them know WE know what's right.
Feel free to use, alter, re-write any and all of what I have written below. I have added links at the bottom to look up and send to our government leadership. Wouldn't hurt to send to personal home state leadership as well. This is addressed generic as each person would want to "personalize" the letter to their respective state leadership and representatives.
I am in TEXAS and have sent this to my representatives both state and federal. I fully intend to send many more as revised and updated information becomes available. Remember...Email is cheap to send.
************
Ladies and Gentlemen:
I would like to point out a few things concerning both Fannie Mae and Freddie Mac from a perspective you most likely do not get the opportunity to see as often as you may like. First, I would like to tell you a little about myself so you have a better understanding of my thoughts.
I am a born and raised 61 year old middle class American. I am a Vietnam era Veteran who proudly served in the United States Navy. I am a Son, brother, husband, father, and grandfather. I am a dedicated, proud American who put myself through college to build a better life for my family. I am an American who has worked hard and invested my money in the future of our country. I am a consumer. I spend my money in my community and surrounding areas to support my local economy. I raised my children and put them through college, who have now moved on to start their own families, and are living and working and contributing to the American way of life. I am a TAXPAYER and VOTER.
This person, the one I described above, for context it is me. But this person is not just me...this person is millions of Americans throughout our great country who have worked hard and sacrificed to achieve a better way of life for ourselves, our families, the people around us, and our communities. This person spans all races, religions, and genders. This person is retired, a teacher, fireman, doctor, construction worker, lawyer, dentist, salesperson, and an accountant. This person is an engineer, IT professional, secretary, welder, government employee, police officer, painter, and landscaper. This person is a small business owner, nurse, a union member, a civil servant, and a member or our armed forces. This person is a stay at home parent, a working parent, or any of a myriad of other professional and non-professional people in all walks of life, who are trying to achieve what we call the American Dream. What we want, what we all want, is to be able to believe in our elected leadership to do the right things. For our elected leadership to do what is best for us and our families, for our country, for our way of life.
The services that both Fannie Mae and Freddie Mac provide are a vital part of our way of life. They allow the majority of America to purchase a home to raise their families, to start their families, to grow their families. They provide much more as well. They allow us to plan for the future. They allow us to invest in the growth of America. They allow us to help one another, as an owner renting to someone just starting out, possibly with the dream of one day purchasing that home for their own future. They allow for those of us less fortunate to still hold that dream of one day owning our own home. They allow us as we grow older to purchase a possibly larger home for our growing family, or downsize to a smaller home as our children leave the nest. They allow us to sell that home to a new family just starting out, or hoping to expand their family.
I won't bore you with countless links to websites, and page after page after page of legal documents from the many, and growing number of lawsuits filed against the Treasury and FHFA over the 3rd ("net sweep" ) amendment that prohibits both Fannie Mae and Freddie Mac from returning to the publicly traded stockholder owned companies they have been for decades. The laws of conservatorship are quite clear and concise.
I will however point out that many of these lawsuits are backed both directly and indirectly by the very people I have mentioned above. We have invested in our 401k plans, mutual funds, individual retirement accounts, and on our own by purchasing what has always been deemed a "safe" investment backed by the government of the United States. We have invested in these two Companies because there has always been an implicit backing by our government, by the voters and taxpayers of this country. We have invested in these two companies, because they are the backbone of the American Dream, and American way of life. Even as both have come under conservatorship, our government leadership continued to imply both were, and would continue to be backed by the government, and one day returned to publicly traded companies and to the shareholders that have invested in them.
The below Q & A came directly from the FHFA's fact sheet, which was taken from the FHFA website.
Q: What are the goals of this conservatorship?
A: The purpose of appointing the Conservator is to preserve and conserve the Company’s assets and property and to put the Company in a sound and solvent condition. The goals of the conservatorship are to help restore confidence in the Company, enhance its capacity to fulfill its mission, and mitigate the systemic risk that has contributed directly to the instability in the current market.
There is no reason for concern regarding the ongoing operations of the Company.
The Company’s operation will not be impaired and business will continue without interruption.
Q: When will the conservatorship period end?
A: Upon the Director’s determination that the Conservator’s plan to restore the Company to a safe and solvent condition has been completed successfully, the Director will issue an order terminating the conservatorship. At present, there is no exact time frame that can be given as to when this conservatorship may end.
Q: What happens to the Company’s stock during the conservatorship?
A: During the conservatorship, the Company’s stock will continue to trade. However, by statute, the powers of the stockholders are suspended until the conservatorship is terminated. Stockholders will continue to retain all rights in the stock’s financial worth; as such worth is determined by the market.
Many questions have arisen as to the fault and cause of the financial meltdown. Who is to blame. Who should suffer the consequences of the Too big To Fail (TBTF) financial institutions that were bailed out by the taxpayers. I have my own personal thoughts and assumptions regarding them, as do most taxpayers. However, I will not share them here as they are most likely a bit more biased than I would like them to be. We see most of the TBTF financial institutions, as well as smaller financial entities have recovered and are back as profitable shareholder owned publicly traded companies, some of them were absorbed into others, and some are still trying to pay back what they borrowed from the government. We see some have returned to the private sector with no further, or minimal government intervention. We see ALL have been reformed to some extent (new rules and regulations) to prevent a future meltdown. We see ALL of the publicly traded and shareholder owned entities...with the exception of the GSE's, have been allowed to continue as ongoing viable and profitable publicly traded companies.
We also see that Fannie Mae and Freddie Mac have paid back more than what they received from the taxpayers, both have paid back in excess of 10% above what was initially borrowed.
As of Jan 23, 2015
Fannie Mae - Total Borrowed - $116,149,000,000
Fannie Mae - Total Repaid - $134,435,000,000
Taxpayer Profit - $18,286,000,000 - over 15% of borrowed value returned to taxpayers.
Freddie Mac - Total Borrowed - $71,336,000,000
Freddie Mac - Total Repaid - $90,969,000,000
Taxpayer Profit - $19,633,000,000 - over 27% of borrowed value returned to taxpayers.
We continually hear about winding down the GSE's. We hear about reform of the financial models that put this country in a catastrophic meltdown. We hear about the length of time it will take to remodel and reform these policies and regulations to better prevent another financial catastrophe.
Ladies and Gentlemen, we currently have two companies that have the technology, expertise, and ability to lead, demonstrate, and move forward with the control processes and procedures needed to prevent another financial crisis in the housing industry, and financial world as well. We need our elected leadership to put aside bipartisan differences and work together to utilize the GSE's ability to maintain and grow the fundamental backbone of America...home ownership.
I would like to make a few suggestion if I may.
1. Continue to REMODEL the GSE's to better contribute and support the housing market. Do not wind them down, rather remold them and utilize their expertise to stabilize and maintain a financial structure of home ownership this country needs.
2. Work WITHIN the GSE's to bring private capital to the table to support housing finance. Possibly an agreement for private capital to take the first 10% - 15% of risk with a reasonable and acceptable down payment by the purchaser.
3. Formulate through and within the GSE's an insurance that homebuyers contribute to, that will help to balance and create an acceptable safeguard for the financial risk of the lenders.
4. Release the GSE's from conservatorship. Allow the hundreds of thousands of tax paying voters and investors the opportunity to continue to grow their retirements and savings, and continue to invest in this great nation of ours. Allow us to continue supporting and investing in the American Dream.
Thank you for your consideration
Sincerely
A veteran
A taxpayer and voter
An American
<your name here>
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http://www.contactingthecongress.org/
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Has anyone thought about and considered the strategy involved with what is going on with the multiple lawsuits...the voluntary dismissal by Pershing....the fully expected decision by Lamberth.
Look at it like a battle....or a chess game.
The multiple lawsuits...allies in a sense...attacking from different points...different fronts....different strategies....each watching and learning from each other on how to better hone their attack.
The ruling allows for Pershing to file its suit again at a later time....if they so choose. This was expected, and no doubt planned well in advance. This creates an additional attack front the treasury/FHFA has to apply resources to in order to defend. Will they re-file that lawsuit? Who knows...but I would surmise the treasury/FHFA will have to expend some resources towards that possible need to defend.
There are what...19 lawsuits ( or more )currently open against them...add more fuel to the fire...force them to expend more resources to defend....when you have multiple presumed fronts to defend, your resources are spread thinner...you have a greater chance of mistake/failure at one of those points of attack...or presumed attack.
Where will the full force of the attacks come from....no clue...only the attackers know that...and the defense is left to guess and hope they have the resources and manpower to defend those attacks without making a mistake or error in judgement.
Ackman has a LOT of money...A LOT OF MONEY. This guy has a legal team with the resources to look at and examine every question, every possibility....every outcome...every conceivable outcome...and practice, practice, practice their attack. I would think most importantly...they have the intelligence and experience well above that of the treasury/FHFA defence teams. Ackman wouldn't be committing the money he is spending if he wasn't confident his chances of winning wasn't well above 50%.
And then you have Fairholme....watching...waiting...gathering intel....Berkowitz is no candy asss.
Personally...I have a helll of a lot more faith in Ackman and his team than I do the FHFA/Treasury team.
no clue where he got it...he does have a website...and he is on twitter...you could ask him. He has some good info on his website as well.
http://www.glenbradford.com/
he will say absolutely nothing about FnF or housing reform or anything dealing with housing.
Full text of oreama's speech - says 2014...not sure if it is this years or not.
http://www.cbsnews.com/news/obamas-2014-state-of-the-union-address-full-text/
I think this is it
http://time.com/3675705/full-text-state-union-2015/
Interesting article that is a few months old. It explains how the taxpayer is getting screwed on the "fines" the TBTF banks are paying.
http://www.newsweek.com/2014/11/07/giant-penalties-are-giant-tax-write-offs-wall-street-279993.html
interesting audio concerning Fairholme... Published on Dec 23, 2013
CW...good to know. At least they are willing to listen and consider the shareholder side of things. That is a very strong positive in our favor. We all know once a person becomes comfortable and accepting of an idea or process of fact...they are much more likely to pursue that direction and support it.
We may not end up with a 100% win in the end...but an acceptable win for the shareholders ( GSE's release from C-ship..and return to publicly traded, profit retained companies )is far and away better for shareholders and the entire country than where we currently sit.
Thanks for the update...hopefully as discovery and understanding...and acceptance of the truth moves forward, the political support will acquire a bit more brass in their shorts and look at a much more logical and practical "reform" of the GSE's and keep the companies and ownership intact. Let the open market dictate the value of two solvent and profitable companies.
CW24...we all know they "know" the money has been repaid...my question is...did any of them openly or publicly acknowledge or admit they agree it has been repaid? We all know what is said in private or "off the record" is typically quite different from what is said or acknowledged publicly.
My thought is, once they openly and publicly state they feel FnF has repaid the monies along with the 10% dividend...that solidifies and sets a new benchmark for shareholders. The first step in any kind of recovery is acknowledgement or acceptance of the truth and facts at the heart of the issue.
TIA
Did any of them acknowledge that FnF has fully repaid the bailout money along with the 10% dividend?
That's $125 bucks spent on this thing....don't really see anything changing.....possibly in the next year we will get a new scam and we may have a chance to bail on this