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You think this is going down by a whole dollar on Monday lol? You realize what price ackman bought at right?
Basically I want to know if you think this is good for long term investors (years), since I know you are a long term investor and not a day to day trader.
So I guess what my last question would be is "are you still long IF berkowitz deal gains support?"
Why would ackman acquire the commons with the berkowitz deal in place? I feel like he would know if berkowitz was going to propose something like this.
I don't really think it matters if they decline, it matters more what demarco thinks imo
So I don't see how this is good for common shareholders then if they get put into receivership?
Thought they couldn't be liquidated when in conservatorship?
What do you think of the fairholme proposal?
Same chick that had the sex scandal too lol
Can someone post that article from the financial times about the hedge funds eyeing fannie and Freddie?
Plus that's just fannie, doesn't take Freddie into account. Disregard last reply
Something to do with 10% dividends/interest they were giving the govt
Anyone have any news on today's hearing?
Any news from the hearing today?
Last year at this time it was worth 30 cents....why can't we just slide down that damn hill yet!
Anything over 50000shares has to be retail
Senator Elizabeth Warren - Fannie and Freddie Did Not Cause The 2008 Economic Crisis
So how can the GSE's be released from conservatorship then? By DeMarco himself deciding when it when not to release them or is it an act of congress that decides when to release them?
The perry lawsuit is what will make this run.
Post the link
And doesn't fannie only have about 5 billion left? It paid 17 billion last quarter correct?
Still holding?
its november 6th
Look at that golden cross with the 50 and the 100
Majority leader Harry Reid supports keeping fannie and Freddie
50MA on crash collision course with 100MA
Anyone?
Anyone else see on cnbc that the deal between Jpm and us govt might collapse?
Oh don't you know? He ALWAYS buys at the lowest point if the day and sells at the highest.
"The answer should be back to Rule 101 - "Never believe 90% of what you hear and doubt the last 10%"
My point is stop listening to those that are throwing darts and they hope it lands on the board at least. "
So you can buy buy buy?
At least the 100dma is acting as great support *knocks on wood*
Still, Majority Leader Harry Reid made waves last month after breaking from the White House and suggesting in a local Nevada public radio interview that the GSEs should be altered but not necessarily shut down.
This is much better.
http://www.americanbanker.com/issues/178_187/warren-says-gse-reform-is-a-priority-1062420-1.html
Can you post the article?
Uhhh if you can't find the correlation on your own....lol
Blame congress
Fannie Mae Survival Back on Table as Lawmakers Sketch New System
The consensus in Washington that Fannie Mae and Freddie Mac should be dismantled is weakening amid opposition from hedge funds, regional banks and others who could benefit if the companies survive in some form.
President Barack Obama and lawmakers from both parties have called for the two mortgage-finance companies to be replaced by a new U.S. housing system. While the official position hasn’t changed, a bipartisan group of U.S. senators writing legislation is grappling with how to ensure that changes to Fannie Mae and Freddie Mac don’t disrupt the recovering housing market.
Some Democrats said they are leery of engineering a switch that would depend on private entities to risk their own capital on home loans.
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“I’m not sure that eliminating the GSEs totally makes sense, as some have suggested, and so I have an open mind on it,” Robert Menendez of New Jersey, a Democratic member of the Senate Banking Committee, said in an interview last week. His comments came after Senate Majority Leader Harry Reid, a Nevada Democrat, said in August that the companies shouldn’t be dismantled.
Since they nearly collapsed during the 2008 credit crisis, the two government-sponsored enterprises, or GSEs, have drawn $187.5 billion from taxpayers and have been considered too politically toxic to be preserved. While the U.S. holds controlling stakes, the outcome will affect private investors including hedge funds Perry Capital and Paulson and Co., which have accumulated preferred shares and have spent months lobbying for Fannie Mae and Freddie Mac to be recapitalized.
Gaining Traction
The hedge funds gained little traction in early meetings with senators such as Bob Corker, a Tennessee Republican who publicly rejected their pleas in the spring. Now, as the legislative process advances and involves a wider group of lawmakers, some are listening to the argument that an entirely new system could risk instability in the market.
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Isaac Boltansky, an analyst with Compass Point Research & Trading LLC in Washington, said that until recently policy makers were engaged in a philosophical debate. Now they have to deal with the practical challenges, he said.
“The conversation is going to shift to whether it’s necessary to burn down the whole house just to rebuild it, or whether there’s merit in renovating it,” said Boltansky.
Record Profits
Driving investor hopes and the change in tone are the record profits Fannie Mae (FNMA:US) and Freddie Mac have been posting as the housing market rebounds from the worst recession since the 1930s. The companies are required to send almost all of those profits back to the Treasury. So far, they’ve remitted about $146 billion, which under terms of the bailout counts as a return on the U.S. investment rather than a repayment.
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Shareholders including Perry Capital and Fairholme Funds Inc. have sued the U.S., charging that Treasury is expropriating the value of its investors’ preferred shares in Fannie Mae and Freddie Mac. Those suits are adding urgency to lawmakers’ efforts.
Fannie Mae and Freddie Mac provide liquidity to the real-estate market by packaging mortgages into securities on which they guarantee payments of principal and interest. Legislative discussions have centered on replacing the companies with a government reinsurance agency as a backstop to privately financed loans that would kick in only after severe losses.
A bill authored by House Republicans that would scrap Fannie Mae and Freddie Mac and largely eliminate government involvement in the mortgage market is unlikely to come to a vote in its current form. House Majority Leader Eric Cantor did not include the measure in a September memo on his legislative calendar for the remainder of the year.
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Senate Bill
Instead, the legislative vehicle is probably a bill being drafted by the leaders of the Senate banking panel, Democrat Tim Johnson of North Dakota and Republican Mike Crapo of Idaho. Their measure, which Johnson said they hope to introduce by the end of the year, will include elements of a bill introduced in June by Corker and Mark Warner, a Virginia Democrat, which would wind down Fannie Mae and Freddie Mac in five years.
Republicans, who have been most vocal about the need to eliminate the two companies, haven’t moved publicly from their position. Even before Fannie Mae and Freddie Mac (FMCC:US) needed a government bailout, the companies gained notoriety in Washington with decades of controversy about their accounting practices and their role in fueling the housing bubble.
“I do believe the transition is going to be difficult and we’ve got to get it right,” Crapo said in an interview on Oct. 9. “But I also believe we should be liquidating ultimately and phasing out Fannie and Freddie and moving to some kind of new structure.”
Community Banks
Republicans and Democrats in general have shown little enthusiasm for a solution that would appear to reward investors more than taxpayers. Corker and Warner say it would be possible to preserve some parts or functions of the mortgage companies without benefitting shareholders.
Hedge funds aren’t the only players pushing lawmakers to reconsider plans for Fannie Mae and Freddie Mac. Regional and community banks that rely on the enterprises to purchase and securitize their loans, for example, have expressed fears that they will be shut out of a new system.
“For a community bank, the process for gaining access to the secondary market would be more difficult than it is today,” under the legislative proposals introduced so far, Camden Fine, president of the Independent Community Bankers of America, said in an interview.
‘Stomach’ Idea
Other market participants, including large banks, have argued that five years isn’t enough time to wind down the companies. They say it’s unclear whether there’s enough private capital willing to take the first-loss position on mortgages if Fannie Mae and Freddie Mac switch off their guarantees.
“As much as it’s problematic in this town for people to stomach the idea that these entities are going to survive, we have to reform and recapitalize and privatize them to ensure stable credit formation during this transition to a new government guarantee,” James Millstein, chief executive officer of Millstein and Co. and the author of a recapitalization plan for the enterprises, said during an appearance at the National Press Club Oct. 1.
Millstein, who said he holds Fannie Mae preferred shares, is a former Treasury official who oversaw the restructuring of bailed-out insurer American International Group Inc.
Financing Deficit
Private-label securities can support about $500 billion of annual housing finance, while the U.S. housing market needs between $1.5 trillion and $4 trillion in annual financing depending on interest-rate conditions, Georgetown University Law Professor Adam Levitin told the Banking Committee during an Oct. 1 hearing. A system in which the government acts as a reinsurer behind private capital could work, Levitin said.
Corker said a safe transition can be accomplished without recapitalizing Fannie Mae and Freddie Mac. He and Warner, his co-author, said that essential functions of the companies could survive in the system that they’ve proposed.
“Our bill outlines a very clear picture for a future state of housing finance that does not rely on the duopolies of Fannie and Freddie, but it smartly leverages the existing technology and infrastructure already built in order to help us get there,” Corker said in an e-mail.
Kenneth Bentsen, president of Wall Street’s biggest lobby group, the Securities Industry and Financial Market Association, said his members are concerned that a five-year transition period may be “aggressive.”
“There’s a lot of value in the infrastructure,” Bentsen said in an interview. “The mortgage industry relies on it a great deal, investors rely on it a great deal. So while you want to move beyond the GSEs -- we understand that that’s the will of a majority of Congress in both parties -- you don’t want to throw the baby out with the bath water.”
To contact the reporters on this story: Clea Benson in Washington at cbenson20@bloomberg.net Cheyenne Hopkins at Chopkins19@bloomberg.net;
To contact the editor responsible for this story: Maura Reynolds at mreynolds34@bloomberg.net
http://www.businessweek.com/news/2013-10-15/fannie-mae-survival-back-on-table-as-lawmakers-sketch-new-system
Why is the ticker above messed up?