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markets are not efficient. the fact that commons are going up bodes well for jps.
Yes, the gses still remain deadlocked in the stranglehold of conservatorship that prevents them from accessing third party private capital.
But now they have close to 4.5 years of retained earnings. This aligns with their cbo report.
Further, i doubt you have sources close to the White House that talk to you?
All you have is the occasional email response from the plaintiff lawyer. Tim P has hosted calls with the legal team in the past.
Lamberth has been issuing opinions on lots of other cases. Ours is probably coming soon. Then the clock starts for the Biden admin deciding to appeal or settle.
My view is they settle and this whole thing moves forward with recap and release. Next few months just like Tim predicts.
Tim P predicted successfully that the SOTU would be the beginning of a major politicizing of affordable housing— and this being a major political issue. Jim Parrott was beside himself with this fact that housing will be a major issue like it never has before in the coming months. That is good for recap and release. We are the only game in town.
$90b is how expensive the program jim parrott put together for affordable housing costs
Check it out. He is a prior wh/treasury official who did the nws
Respectfully disagree.
This administration may not be actively working on it right now. That is fine. What Tim predicted so far happened.
Housing has become a huge political issue. Review what Jim Parrott said at that same conference.
According to WH insiders, the WH has until June to take action here. 4 more months. Enjoy
thanks for your notes.
respectfully, thank you.
thanks for sharing your insight here. obviously i disagree with your insight.
Sounds like you have come down with a case of the berkowitz.
While i understand your perspective — I personally will not be following suit.
That said, good luck with whatever you decide to do next or instead. Cheers.
Yes. They have tabled it until it becomes a political priority. They just started that at sotu. Now housing becomes elevated. They will not announce what they are working on this. They will announce that it is done and just implement it.
Things are progressing nicely mr maloni.
Lael had qualifiers in her statement. Yellen deferred. Both stated the current public perspective. Yellen backtracked already. Now housing is in crisis but two weeks before had no idea.
Brainard — sure they arent working on it now. They completed the work and shelved it late last year.
Now they are drumming up support to pull out their solution. Give them time to politicize the problem. Then they can swoop in and paint themselves as heroes in the process
quite a lot. so much so that i would commend the peanut gallery here --- anyone who criticized me for this is probably right, but then again, who knows where i would be now if i had gone that route, who knows if i would have gone plus ultra in the last 2-3 years post scotus.
good luck getting republicans to fund it, that's my point, republicans are going to point to warrants.
you will see.
yes they are, no material change
Single-family housing faces a shortage of 5 million homes. Immigration influx compounds, driving housing prices up.Solution? Federal action: recapitalize and release Fannie and Freddie.Reinvest in building housing supply and curb inflation. $FNMA #FANNIEGATE @Forbes @timpagliara https://t.co/sqqTGqVDLv
— Fanniegate Hero (@DoNotLose) March 12, 2024
That is what berkowitz is worried about and why he sold out.
I think he just does not understand or fully appreciate the driving forces here moving forward
Yup. So no material new changes here. But the language as it reads is very promising even without changes.
This administration wants congress to fund the build of 2m more housing units. The only way to fund that is to monetize its equity position here
Is this new language???
“ The Administration is
committed to housing finance policy that increases the
supply of housing that is affordable for low- and moder-
ate-income households”
I personally understand that to be THE driving force to end the conservatorships — if that is new language then i may have overlooked the significance. Even if it is not new language though— i think you are overlooking the significance of its consequences
Interesting— interesting perspective
Whether it is because whomever is buying expects things to happen sooner or later
Biden cannot accomplish his affordable housing objectives without recap and release. That is the major thing. Now this is politicized. If he wants to fund his plan he has to sell this stock. Get them out of conservatorship. Fnma ceo said victory lap
Wish you well
Fnma is the main msg board. Are you not posting there cause ya sold
Commons have no security and i will not own them for this reason but good luck to you in the future for your gamble on restructuring mechanics that may favor your share class to perhaps solve the affordable housing crisis
Since then commons have outperformed jps i think. Congratulations.
i would recommend that all of us register for this urban institute hearing and ask them how getting fannie and freddie out of conservatorship can help this administration achieve their housing policy objectives --- or if they have thought about why congressional republicans would support funding their housing supply build plans:
https://www.urban.org/events/biden-harris-administrations-housing-policy-agenda-conversation-lael-brainard-national
Lael brainard and jim parrott are doing a housing thing i think next wk. i think jim put together the recap and release plan that floated the WH late last year that imf reported on. Also apparently janet yellen did a 180 on housing since doing the senate banking committee hearing. From being clueless to it being a crisis.
Fannie mae ceo begged to be released. I think these higher prices are from people seeing this and buying on the hope they are going to exit conservatorship in our lifetimes
Housing is number two voting issue. I expect him to talk housing. Lamberth still needs to rule on damages allocations i think and fhfa would need to then move to settle by paying them. Presumably any day. Lamberth has been issuing lots of opinions lately.
Our original case stared 2013. Lol. 11 years for like a quarterly divident payment. Nice
Courts are a blooper reel
I miss myself too. Sotu thursday Super Tuesday. Big week. We will see the arb firm up here and see if they are going to restructure this year soon
Fannie hits 2.5% stat cap nexy yr
As for me I just expect the Biden admin to — if it is going to do anything to lock in its housing policies— which I expect it will— with actions coming shortly— in the coming weeks— to move to restructure Treasury’s equity stake in Fannie and Freddie to enable them to raise third party capital and effectuate the capital restoration plans they have put in place — they just finished their resolution plans last year. Late last year I believe was the deadline. The main guy overseeing their completion retired.
That is too bad. I have been reprimanded by ihub admins for posting a political comment here— i weote back that the end of conservatorship is tied to admin action which is a political thing.
We will see. If the government wants maximum warrant value i think they may spspa writedown, i am not sure if the commons have any value without a writedown and i am not sure if they can spspa convert then warrant exercise. Shrug. Enjoy
i'm mostly just looking at the first week of march. super tuesday and sotu.
For starters I did not expect that the Courts would ultimately misinterpret HERA and the law the way they have. Secondly, the way they did makes FHFA a political agency. For Biden to implement ang lasting reforms his team has to execute the restructuring and put them on course to exit. Admin action. I thought Biden would want to act sooner, but I guess the timing for admin action that is best for the Biden team is coming up shortly.
I think previously I was expecting the Trump team to act. The Trump team did effect the major overhaul of retaining earnings. They just did not get the restructuring done. I would be curious how long Mnuchin and Craig Phillips have any possible buying restrictions on gse equity securities— if any. It is interesting to me that Craig is getting into cmbs instead of this.
We are past the Deese window for his estimate of when Biden admin would act. Biden spent the money by doing the accounting. Now, I expect him to get to spend it again.
Yup thats a good one
The problem is that he has gone with simpler explanations in times past and they still elude you.
His composite work of all his posts is a lesson in security analysis in the echo chamber of people who do not understand their place in the capital stack.
You should be taking notes, but you are not. Your loss.
The GSEs Have Been Profitable Since 2012. Maybe It’s Time to End the Conservatorships?
dhollier@imfpubs.com
Fannie Mae CEO Priscilla Almodovar set tongues wagging recently when she hinted that maybe the time has come to end the 15-year old conservatorships of the government-sponsored enterprises.
“Conservatorship was never meant to be permanent, right?” she asked rhetorically in an interview with Bloomberg. She also summarized the argument for the GSEs’ release, noting, “Someone somewhere has not taken a victory lap for the work that has been done to rehabilitate the enterprises.”
This was precisely the sort of public commentary that former Federal Housing Finance Agency Director James Lockhart recently told Inside Mortgage Finance the GSEs should be engaging in. He said that, despite the edict against lobbying by the GSEs, as long as they don’t ask for specific votes, it’s fine for them to educate Congress and the public about issues like the conservatorship.
Almodovar was careful not to cross the forbidden line into outright lobbying, noting that her job is to manage the company and leave the issue of the conservatorships “for policymakers to decide.”
100% agree
Wishing you well on this requirement of your investment. I continue to wonder if the politics
Of the warrant money favors commons here.
On this i am unclear.
And for this reason i am out. -shark tank style
I realize you do not understand this and are yoloing. Good luck to ya
It is true. She did say that.
Fhfa needs congress or treasury to end the conservatorships. In this case her audience was congress, so she asked them to help.
Admin reform is not up to ST. That is WH. WH leadership has staged everything. Housing will become a huge election issue in the next 45 days. Recap and release is part of the solution.
Question — for you
In your opinion— if the warrant value can be used politically, do you see the possibility that the government officials in the WH pursue the path that maximizes their value and allocates the proceeds to housing infrastructure grants?
Can the government extract $100b in warrant value while simultaneously zeroing out existing common?
Like can they convert spspa and then exercise warrants? Is there an ordering requiring them to exercise the warrants before converting the spspa or thoughts there?
Not a lot — the main thing is that the gov acted in bad faith according to a jury
Navycmdr didnt fill this out