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And we are climbing on lunch break. It could be a good close.
Go FnF!
The rumor must be true! $5.00 soon
Trump Considering Herman Cain for Federal Reserve Board, Sources Say
https://www.bloomberg.com/news/articles/2019-01-31/trump-is-said-to-consider-herman-cain-for-federal-reserve-board?srnd=premium
Not quite that high as it will be based on knots. Do your DD!
Post a link to this outlandish claim!
Go FnF!
You are giving me goosebumps! Or it's this cold front.
Because we still have to complete our uplisting by this Friday!
Go FnF!
That is a joke and since I had to say that it is no longer funny but somebody may ask me to prove it with a link
And outlandish! Positively incredulous and zany!
Go FnF!
Fannie is choppy today!
Ballsy flippers can make some money catching these waves but risk missing the boat!
Go FnF!
The backlash to Otting’s comments was swift, with the White House issuing a Tuesday statement that said the administration would work with Congress on a plan for ending the government’s decade-long control of Fannie and Freddie.
Shares Surging
Speculation that Treasury and the FHFA might unilaterally let Fannie and Freddie build up capital and then release the companies had prompted the companies’ shares to surge this month. Hedge funds and other investors were hopeful that any plan would allow shareholders to get their hands on Fannie and Freddie’s profits, which now go to the Treasury.
Otting’s Wednesday letter is the latest sign that a revamp that frees Fannie and Freddie probably won’t happen anytime soon.
The Trump administration’s push to end the conservatorships will likely start with the White House calling on federal agencies to put forth ideas for a legislative and regulatory overhaul of the housing-finance giants, Bloomberg reported Tuesday, citing people familiar with the matter.
The White House may outline a broad set of recommendations, such as increasing competition for the companies and protecting taxpayers from losses, and then request that Treasury and the Department of Housing and Urban Development propose plans for implementing them, said the people.
To contact the reporter on this story: Elizabeth Dexheimer in Washington at edexheimer@bloomberg.net
To contact the editors responsible for this story: Jesse Westbrook at jwestbrook1@bloomberg.net, Gregory Mott
For more articles like this, please visit us at bloomberg.com
Fannie-Freddie Regulator Now Welcomes Lawmaker Input on Revamp
Posted Jan. 31, 2019, 4:27 AM
By Elizabeth Dexheimer
FHFA’s Otting tells Waters, Brown he wants their ‘perspective’
Otting letter walks back comments about circumventing Congress
In an apparent about face, Fannie Mae and Freddie Mac’s regulator told congressional Democrats Wednesday that he welcomes their input on coming up with a plan to free the mortgage giants from federal control.
“As we begin the journey of evaluating the enterprises and developing a framework for ending conservatorship, I would welcome your insight and perspective,” Joseph Otting, the acting director of the Federal Housing Finance Agency. wrote in a letter to House Financial Services Committee Chairwoman Maxine Watersand...
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https://news.bloomberglaw.com/banking-law/fannie-freddie-regulator-now-welcomes-lawmaker-input-on-revamp
Nicely said but there is not only one move to make and it has to do with risk tolerance as much as awareness. FnF have been long shots from the beginning, common or pref.
Go FnF!
I have said this many times. There is a fine line between wisdom and stupidity. Fannie will determine if I am wealthy and wise or stupid and still working!
Go FnF!
. If you study what was actually said instead of how it was spun by the media, it all aligns.
Investment Thesis
The prior director of FHFA, Melvin Watt, couldn't be fired or terminated early, because if he was, Trump would have had to pick from one of his deputies to be the next acting FHFA director while Calabria went through the confirmation process. This is why GSE reform hasn't yet taken place yet under the Trump administration
Agreed!
Go FnF!
How long has the executive committee language been in the bylaws? Was it first added to the bylaws when they were put into conservatorship? Curiouser and curiouser!
Go FnF!
White House Didn't Walk Back Otting's Comments On Fannie/Freddie
Jan. 30, 2019 2:37 AM•FNMA
Summary
The White House made public statements about housing reform.
Lots of journalists wrote this up saying that they were walking back Otting's statements.
The White House commentary aligns with everything said so far by Otting and Mnuchin, who are the two government officials on both sides of the PSPA.
Fannie Mae (OTCQB:FNMA) and Freddie Mac (OTCQB:FMCC) are two companies in conservatorship governed by the Federal Housing Finance Agency (FHFA). FHFA got a new director Joseph Otting on January 7th of this year. Otting recently spoke to the FHFA, and an audio recording of what he said leaked to the public via Politico. The stock valuations have been increasingly volatile as the media tries to take sides on what's what. If you study what was actually said instead of how it was spun by the media, it all aligns.
Investment Thesis
The prior director of FHFA, Melvin Watt, couldn't be fired or terminated early, because if he was, Trump would have had to pick from one of his deputies to be the next acting FHFA director while Calabria went through the confirmation process. This is why GSE reform hasn't yet taken place yet under the Trump administration: Watt wouldn't sign off on it. Otting is different. “The Treasury and White House viewpoint is that the (FHFA) director and the secretary of Treasury have tremendous authority and that they would act, I think, independent of legislation if they thought it was the right thing to do,” he said. Otting went as far as to outline the framework that the Trump administration had in mind at that meeting.
Recent White House comments are being misconstrued as somehow being different from what Otting said, but in reality, they are in line with what Otting said. If I'm right and Otting and the Trump administration stop the net worth sweep shortly and begin recapitalizing these companies, preferred shares have voting rights that they can use to amend their securities to assist in the recapitalization efforts. Common shares are subject to dilution, but still probably have upside from here if there are no stock conversions before the warrants are exercised. They may have more upside than the preferred, but it's hard to say because there are lots of variables. I own preferred and recommend preferred.
Working With Congress
Administrative action does not prevent legislative reform. Mnuchin has said in the past that he wants an explicit security-level guarantee. The only way to do that is through new legislation. That is in line with the White House commentary today:
"The Trump administration plans to work with Congress to overhaul mortgage-finance giants Fannie Mae and Freddie Mac, a White House spokeswoman said Tuesday."
Further, the White House confirmed that we should hear about a framework from the White House shortly:
“Housing finance reform is a priority for the administration,” White House spokeswoman Lindsay Walters said in a prepared statement. “The White House expects to announce a framework for the development of a policy for comprehensive housing finance reform shortly. At this time, no decisions have been made on any reform plan.”
Historically, the White House has let Congress take the lead on housing finance reform. Now, the White House is taking the lead by announcing the framework. No final decisions have been made yet, but that's because it's just the framework, and a lot of it involves delegations and back and forths between not only various government agencies but also with Congress to see what, if anything, Congress would like to sign off on as well. That said, Otting has made it clear that there is a path:
“This is a path that’s been established by the White House and the Treasury, and Mark has signed off on it, I’ve signed off on it, Treasury has signed off on it, the White House has signed off on it,” he said.
The White House framework will likely not make specific recommendations about what to do, but I don't think it needs to.
Prior CFO of Fannie Mae Timothy J. Howard Agrees
The prior CFO of Fannie Mae chimed in on the White House press release:
?
I look forward to seeing if Otting's letter to Maxine Waters and Sherrod Brown gets made public on Friday and the White House plan when it comes out. Previously, Mnuchin wrote to Sherrod Brown that "any solution will be dependent upon the GSEs being capitalized properly and other such controls that eliminate risk to taxpayers."
Investors Unite Teleconference
Investors Unite is holding a teleconference on Thursday, January 31, at 10 am EST about how the Collins vs. FHFA en banc went in the context of the litigation overall. One of the plaintiff lawyers, David Thompson, will be on the call. Investors Unite was formed by Tim Pagliara to represent Fannie and Freddie shareholders. I participated in one of their events visiting senators and Congress people in Washington, DC.
Summary and Conclusion
The administration continues to tell the same story that it has been telling since before Trump was president and Mnuchin officially became Secretary of the Treasury. That story is one of the conservatorship ending and getting Fannie and Freddie out from government control. With the previous administration having a guy at FHFA who resisted administrative action, we all had to wait patiently for Trump to get Otting in there. The previous guy couldn't get fired early because it would have kept the previous administration in power longer at the FHFA, continuing to not take administrative action.
Otting has primed the pump for the administration leading Congress on housing reform. The administration can take action and give options to Congress if it wants to help out, which is why there is no final plan yet. Plus, FHFA is an independent agency, and the capital restoration plans have to be delegated from it to Fannie Mae and Freddie Mac.
The fact that the White House is taking the lead on a housing reform framework says enough about who is running the show now. Preferred shares trade at less than 40% of par value, but I figure in any recapitalization they are worth around par as a base case, because why would any class vote for less. If you don't agree, I encourage you to listen to the Investors Unite call Thursday.
Disclosure: I am/we are long FMCCH,FMCCI,FMCCL,FMCCN,FMCCP,FMCCS,FMCCT,FMCKP,FNMAM,FNMFN,FNMFO.I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
https://seekingalpha.com/amp/article/4236554-white-house-walk-back-ottings-comments-fannie-freddie
FHFA head offers olive branch to Congress on privatizing Fannie Mae, Freddie Mac
By Andrea Riquier
Published: Jan 30, 2019 5:11 p.m. ET
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In a letter obtained by MarketWatch, the acting director of the Federal Housing Finance Agency on Wednesday wrote to senior Democrats on the Senate Banking Committee, offering to work together on efforts to release Fannie Mae FNMA, +2.17% and Freddie MacFMCC, +0.90% from government conservatorship. Joseph Otting told House Financial Services Committee Chairwoman Maxine Waters and ranking Senate Banking Committee member Sherrod Brown that he "would welcome your insight and perspective" as overhaul efforts begin. That step follows reporting by MarketWatch that showed Otting intended to work directly with the Treasury Department to release the two mortgage companies, with no participation from Congress. The White House also has said they will work with Capitol Hill to take the mortgage giants out of conservatorship.
https://www.marketwatch.com/story/fhfa-head-offers-olive-branch-to-congress-on-privatizing-fannie-mae-freddie-mac-2019-01-30
I love that clip!
Go FnF
I picked up 2000 more shares at $2.34 yesterday.
Go FnF!
That tells me that elected reps can put their two cents in but nobody is waiting for Congress to act.
Go FnF!
This may be informative
Investors Unite Teleconference: GSE Shareholder Litigation Update
Thursday, January 31, 2019 // 10:00 a.m. ET
January 30, 2019 02:36 PM Eastern Standard Time
--(BUSINESS WIRE)--On January 31, 2019, at 10:00 a.m. ET, Executive Director of Investors Unite Tim Pagliara will hold a teleconference to update Investors Unite members on the most recent legal developments in U.S. Fifth Circuit Court of Appeals Collins vs. FHFA shareholder litigation.
The discussion will feature a summary of the Collins vs. FHFA case where shareholders challenge the structure and legality of the Federal Housing Finance Agency (FHFA), and other GSE shareholder litigation updates.
Investors Unite Executive Director Tim Pagliara will be joined by David Thompson, one of the attorneys representing the plaintiffs in Collins vs. FHFA, who presented oral arguments on their behalf.
To join the teleconference, please RSVP to info@investorsunite.org.
Who:
Tim Pagliara, Investors Unite Executive Director and CapWealth Chairman and Chief Investment Officer
David Thompson, Managing Partner of Cooper & Kirk
What:GSE Shareholder Litigation Update Teleconference When:January 31, 2019, at 10:00 a.m. ET Dial In:866-342-8588 or 203-518-9865; Conference ID: 52478 RSVP:
Please RSVP to info@investorsunite.org
To ensure you are on the line in time for the start of the call, please be sure to dial in a few minutes ahead of the scheduled start time.
About Investors Unite: Formed by CapWealth Chairman and Chief Investment Officer, Tim Pagliara, Investors Unite (www.investorsunite.org) is a coalition of over 2,000 individual 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.
Contacts
Investors Unite
Tim Pagliara
866-288-2537
https://www.businesswire.com/news/home/20190130005732/en/Investors-Unite-Teleconference-GSE-Shareholder-Litigation-Update
I am comparing the two subjects as similar in the tools and strategies available to the administration. I am sure there is a forum for you to debate immigration policy and immigration truths and immigration in general but not here. Not with me. I am discussing comparison of strategies to free the twins. Let's stay on point.
Go FnF!
The White House also expects to announce a framework for developing comprehensive housing-finance changes “shortly,” White House spokeswoman Lindsay Walters said. But that framework will not likely make specific recommendations about what to do with the two companies, according to people familiar with the administration’s thinking.
If WSJ can quote Lindsay for the first part of this why not quote real people for the second part? (according to people familiar with the administration's thinking). Secret people. In the know about administration's thinking.
Andrew writes for The Wall Street Journal's financial regulation team in Washington, D.C., where he focuses on how Washington oversees Wall Street. His areas of interest include: efforts to roll back post-financial-crisis bank regulations, the Trump administration’s work to end government control of Fannie Mae and Freddie Mac and the unintended consequences of new financial rules. He can be reached by email at andrew.ackerman@wsj.com, on WhatsApp and Signal at +1-202-590-6178 and on Twitter at @amacker.
https://www.wsj.com/news/author/7548
About the wall, another caravan is on the way. It is larger than the last caravan. Congress has 3 weeks to deal with it or Trump will use his authority. The closer the caravan gets the closer the emergency. This is the strategy. Let congress be inept and ineffective and then take action. The same with the GSEs. Let Congress be inept and ineffective and then take action. That is my comparison.
Go FnF!
Kind of like working with Congress after the government shutdown is over. Listen to the yammering congress then do what needs to be done. In the case of the wall just declare an emergency or crisis and get it done! It will be the same with FnF. Give Congress the opportunity to contribute knowing that Congress will not contribute. Afterward just make the administrative changes. Get it done!
Go FnF!
That may not be announced as such. They may allow the twins to retain capital which happens to be equal to earnings. For some reason(s) nobody likes to announce positive things for FnF. We may have to read between the lines a little bit. That possibility will give us a head start on the lemmings. Know what I mean?
Go FnF!
Well I guess I got my cheapies. I knew I should have sold a few at $3.00
Go FnF!
Does everybody still like high volume?
I just have this picture in my head. It is a cliff and millions of little panicked animals!
Go FnF!
Damn I had to sell another stock and before I freed up the money and was able to buy it was back to $2.35. Still cheap as hell. Thanks for the 2000 more shares!
Go FnF!
But jog49 that is exactly what continues to be overlooked. It is overlooked by the legislative and executive branches because they are complicit. It is overlooked by the judicial because____ ____.
Fill in the blanks. My guesses are ignorance, misinformation, corruption.
Hopefully new elected officials and judges have their eyes open going forward.
I just realized that you know this already but I typed it so I am posting it.
Go FnF!
Right now the market is of the strong view that when it’s all said and done, the government will provide a guarantee for securities issued by Fannie and Freddie, but as soon as it starts pricing in the possibility that the government would not provide the same liquidity, that could be reflected in mortgage rates overnight,” he said.
Trump can not afford this. We are in good shape. IMO
GO FnF!
So the market is just like my ex.
Go FnF!
If you have to throw the bills away at least advise Jasmine or Electra to invest them in FNMA!
GO FnF!
Do you realize that you could put those Bill's into more Fannie? They are just dollar Bill's but they add up.
I could have really crude!
Go FnF
I do not believe it was a p.r. It was an inhouse meeting that somebody supposedly recorded. POLITICO says that they have the recording in their posession.
I think.
Go FnF!
Shares of Fannie, Freddie soar as Wall Street bets on GSE privatization
Common shares up 170%
January 28, 2019
Jessica Guerin
KEYWORDS FANNIE MAE FREDDIE MAC GSE CONSERVATORSHIPHEDGE FUNDS JOSEPH OTTING
?
There’s been lots of noise lately that the end of Fannie Mae and Freddie Mac’s conservatorship is looming, and the speculation is causing the GSEs' stocks to soar.
According to an article in The Wall Street Journal, common shares of Fannie and Freddie are up 170% this year, while preferred shares, which are the most commonly traded class, are up 37%.
Less than two weeks ago, Federal Housing Finance Agency Acting Director Joseph Otting reportedly told employees the agency was weeks away from announcing a plan to take the GSEs out of conservatorship.
It’s hopeful news for the GSEs’ major investors, which include Discovery Capital Management, Blackstone Group and Pershing Square Capital Management, according to the WSJ.
Hedge funds have been betting on GSE privatization for years, insisting that the government should sell its stake in the market and make way for private shareholders who can shoulder the liability. They’ve made their case repeatedly on Capitol Hill, but the struggle has gone on for nearly a decade without making headway.
While the WSJ said that an end to the conservatorship is merely speculation – and that such a change could impact the price and availability of mortgages for millions of Americans – it would be a final step in the resolution of the housing crisis that rocked the nation.
“Should a plan go forward, it would conclude the biggest unresolved legacy from the financial crisis – what to do with the failed mortgage-finance companies – and partly determine whether hedge funds wind up profiting from their wagers,” the article stated.
https://www.housingwire.com/articles/48027-shares-of-fannie-freddie-soar-as-wall-street-bets-on-gse-privatization
It is the best of times, it is the worst of times…..
As I noted in my last (brief) blog, lots of GSE-centric things have occurred in the past few weeks.
Most Notable:
--Acting DFHFA Director Joe Notting offers provocative and positively pregnant statements about returning the GSEs to greater/full functionality (but Devil is in the details);
-- Fifth Circuit Collins en banc hearing generates some hope for a pro-plaintiff’s decision;
--Senate and House Banking Committee Democrats submit amicus briefs to Fifth Circuit intended to signal WH Hill D’s want to solve GSE issues with legislation, not regulatory action;
--stories about Treasury officials liking what they see in “Moellis plan” (largely pro-GSE, save excessive capital requirement) and possibly using it as part of an “executive GSE fix”;
--HBC Chair Maxine Waters (D-Cal.) prioritizes reviving Fannie and Freddie and their former affordable housing mission:
--GSE preferred and common stock prices increase to recent highs (but not historical ones).
Good news/Bad News
Right now, there is a lot of GSE optimism from investors and others and you have every reason to feel good after a decade of fallow years.
The wind is not at the backs of we GSE advocates and the “bad guys” will get louder and more numerous as any positive GSE momentum grows.
While early reviews from the Fifth Circuit hearing generated senior judges asking tough questions of government (defendant’s) lawyers. Plaintiffs still need a majority of the 16 voting judges to prevail at this legal stage.
Most –but not all—of the plaintiff's same arguments, failed to move Judge Lamberth, originally, or any of his judicial colleagues in subsequent GSE cases in other courts, save one or two instances.
All of those past august jurists, like Lamberth, decided that the federal government under HERA could do anything it wanted to Fannie Mae and Freddie Mac…and pretty much got away with it.
Meaning, we’ve lost far more cases than we’ve won.
Beyond the government lawyers possibly lying and withholding facts from Lamberth--which happens more often than we think--why will this outcome be different than previous ones, since most of the judges “read the newspapers” and know that this Admin, many in the media, and most of the congressional GOP think ill of the GSEs?
It wouldn’t shock me if the en banc Fifth Circuit judges just take for granted that (government) lawyers lie.
Possible Damages
Nobody knows exactly what damages a supportive 5th Circuit might award plaintiffs. We’ve all seen and discussed financial estimates, with guesses running from $100 Billion to $300 Billion.
Any of those would be a massive award and draw fire.
With many R’s disliking Fannie and Freddie structurally and many D’s disdaining the “hedge funds,” I think congressional opposition would be loud and possibly dominant, especially when the Trump Administration is running huge federal deficits with few reversal prospects to staunch the red ink.
Oh, and forget about that fact that there are thousands of small investors—not only hedge funds—among GSE shareholders. Plaintiffs largely have been demonized as hedgies and there is no way to undo that fact, plus these lawsuits do have plenty of hedge fund money driving them.
IMO Legislation not likely
I think you can forget about GSE legislation* in 2019, because while the Democrats have won the House. There aren’t 60 votes (ultimately) in the Senate for a progressive “free the GSEs with an enhanced affordable housing role”statute nor many in the House for dismantling Fannie and Freddie. As a possible Democrat presidential candidate SBC Chairman Sherrod Brown (D-Ohio) has to be especially careful about the national impact of any statutory changes—housing or otherwise—he champions or supports.
Brown’s Committee also has announced presidential candidate Sen. Elizabeth Warren (D-Mass) as well as **Mark Warner (D-Va.), one of the Senate’s richest members who likes to crack wise and denigrate the GSEs.
One thing which can/should be considered by the Congress (are you listening Chair Waters, HBC members, Senators Brown and Warren?))—especially with the growing number and business volumes of non-bank mortgage originators—is to subject the non-bank mortgage lenders, as well as the nation’s largest banks, to statutory low-mod mortgage origination goals rather than putting that burden exclusively on the GSEs.
Keep the GSE goals--even make them slightly higher--but support the GSEs by requiring primary market lenders to find those eligible borrowers and make those same loans. Pass new legislation and don’t rely the existing, quite flaccid Community Reinvestment Act (CRA), which is as toothless a tiger as you can create…no matter how much the banks complain about its toughness. When you hear the big banks bitching about CRA, think “rabbits complaining about being thrust into a brier patch.”
(* One caveat is if the WH’s executive action leaves an agreed on designated “hole” for Congress to act and add something to its exec order. Bearing in mind Congress always can act to amend or create legislatively anything it wants, but massive GSE reform has confounded Congress even when the GOP controlled the Senate, House, and White House because Fannie and Freddie are too valuable and cannot easily be replaced, absent a viable alternative and a much larger consensus.)
Resolution?
Because of the congressional loggerheads, which have existed for years and haven’t been solved by the welcome new D House majority, I am rooting for a Treasury scheme implemented with the inherent authority it and FHFA have. Ideally, some version of the “Moellis Plan,” with lower GSE capital, mandates which Tim Howard eloquently argues for in his blog this week. Both Senate and House Banking members—and their staffs—need to read Moeliis and understand what it proposes.
In the same context, policymakers need to understand there is a cost to excess capital, in higher mortgage rates, fewer families served, and systemic inefficiency.
But, with the absence of real congressional understanding of how our nation’s mortgage markets work, there always will be a large Hill soft spot for those who argue “more capital is better.”
(**Last week Warner was quoted complaining that the GSEs advocates were seeking “private gain and public loss,” a tired old falsehood that originates with the bank-dominated anti-GSE FM Watch group.
(In my 21 years at Fannie Mae, there never was one dollar of corporate losses not balanced and offset by corporate earnings, with no maneuver or request to ask the taxpayer to pick up those debts. In addition, in those same two decades plus, I never heard one senior corporate executive suggest Fannie’s myriad mortgage business initiatives or product executions contained zero risks because “Treasury, the taxpayer, or Uncle Sam,” would bail the company out. Certainly, Fannie never operated like that in my time.)
(Senator Warner, who likens himself to a sophisticated financial markets student, should know better and be less flippant with his characterizations, if for no other reason than some 6000 Freddie and Fannie employees, or more, are his Virginia constituents.)
Maloni, 1-29-2019
Corker
See Investor Unite's Tim Pagliara go toe to toe (with Corker elevating his height on an airplane seat) over the Senator's financial dealings.
http://tennesseestar.com/2019/01/25/off-the-record-sources-say-bob-corker-instigated-confrontation-on-plane-with-prominent-tennessee-gop-donor/
http://malonigse.blogspot.com/2019/01/idle-thoughts.html?m=1
I believe that some sort of conspiracy/collusion/cabal exists. In my perfect world the good guys catch the bad guys. In our imperfect world the chance for criminal justice does not exist for FnF shareholders. Just think about how many patsies the bad guys would have to frame in ordered to protect the very powerful people/criminals involved. So, it stays burried.
Very general outline but enough to get my point across. It would be nice to be wrong.
Go FnF!
This is funny. I check FnF several times a day knowing that it will be bouncing all over the place all day long. The bouncing does not matter but I can not help myself. I have been long for years and all of my reasons for that are still valid. We are closer than at any time since I first bought shares. I may trade a few shares but only a few for fun. I may make a post like this from now on as a daily affirmation.
All in favor say aye!
All not in favor can kiss my fannie!
Go FnF!