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The defendants wanted them to hold off until discovery was completed. Plaintiffs said they could wait a couple of weeks, but didn't want to hold off longer than that.
They were used and abused, but no longer! Stop the sweep! Set them free! Depositions were going to start tomorrow, but I think the plaintiffs said they could hold off a couple weeks.
Both sides playing the blame game. Both sides played along with the slush fund and told the shareholders to be quiet, because they were under conservatorship. Surprise! Fnf started making profit sooner then expected. It was conservatorship, not receivership, shareholders are still here! We're not going away!
Treasury uncaps credit line for Fannie, Freddie
By Corbett B. Daly
WASHINGTON | Thu Dec 24, 2009 5:11pm EST
WASHINGTON (Reuters) - The Obama administration pledged on Thursday to back beleaguered mortgage finance giants Fannie Mae and Freddie Mac no matter how big their losses may be in the next three years.
It also jettisoned a demand that the two companies cut the size of their mortgage-related investment portfolios next year, allowing them to provide even more support in the near term for a housing market recovering from its worst slump in decades.
The Treasury Department said it made the changes to assure financial markets it stood firmly behind both companies and to buy more time for the two government-sponsored enterprises to whittle down their mortgage-related holdings.
The two agencies each had a Treasury credit line of $200 billion. Combined, they have so far tapped about $111 billion.
The Treasury's announcement came just hours after the companies said their chief executives would be paid up to $6 million on an annualized basis for 2009.
Few analysts had expected Freddie Mac to tap full the $200 billion, but Fannie Mae's poor underwriting standards left it with losses many thought could grow past $200 billion.
The administration waited until financial markets had closed on Christmas eve to make the gannouncement, thwarting chances for critics to have their voices heard.
"This news today won't ruin anyone's Christmas. That is, except for those who are worried about the size of the nation's debt," said Mark Vitner, a senior economist at Wells Fargo Securities in Charlotte, North Carolina.
Under a law put in place before the government seized the two mortgage agencies in September 2008, Treasury Secretary Timothy Geithner had until the end of this year to increase the limit without asking Congress for approval.
Treasury said Fannie Mae and Freddie Mac would still need to reduce their portfolios eventually.
Under the new rules, their holdings could be no larger than $810 billion at the end of next year. The limit would drop by 10 percent a year thereafter, lessening the support they could provide to the mortgage market.
Fannie Mae and Freddie Mac are congressionally chartered companies that buy up mortgages from banks and other originators to keep mortgage markets liquid. Some of the debt is repackaged as securities and sold off to investors, and the government has been buying an increasing share.
Each company currently holds portfolios in the high $700 billion range, officials said, meaning that they would not be forced to sell assets next year.
HOUSING STILL NEEDS A LIFELINE
The 2010 reprieve was designed in part to avoid putting an added strain on the housing sector as the Treasury and Federal Reserve wrap up programs to purchase mortgage-related debt.
As part of its announcement, Treasury said it was ending its mortgage-backed securities purchase program at the end of this year and the Fed has previously said it would wind down its separate program in the spring.
The Obama administration hopes its unlimited guarantee will bolster investor confidence and bring private sector buyers back into the market to help hold down mortgage costs.
Without healthy demand for MBS and the debt of the two finance companies, mortgage rates would likely spike, sending a chill through the still-shaky housing market.
The administration has already said it plans to lay out a vision for the future of the two agencies in the president's fiscal 2011 budget proposal in February.
"The administration will have to determine what their status will be to support the housing market -- whether they stay as some kind of government-sponsored enterprises, become fully privatized or become full government agencies," said Larry Milstein, head of government and agency trading at R.W. Pressprich & Co. in New York
Thursday's announcement was reminiscent of former Treasury Secretary Henry Paulson's colorful remark to Congress in July 2008, when he was lobbying for the bailout of Fannie Mae and Freddie Mac. Paulson told lawmakers that giving him authority to rescue the firms would reassure private investors.
"If you have a bazooka in your pocket and people know it, you probably won't have to use it," he said at the time.
However, less than two months later, the two companies were placed in a government conservatorship. Early in Obama's administration, the credit line for the firms was doubled to $200 billion each. It is now unlimited for three years.
(Additional reporting by Emily Kaiser in Washington and Richard Leong and Julie Haviv in New York; editing by Leslie Adler and Diane Craft)
This post was erased last night. Sorry, I must be putting something in there I'm not supposed too!
Like I said last night, that post is copied from Nasdaq site. I wouldn't write After Hours. I'm too lazy to add the qualifier in case others don't know about T-trades, but here's a good article again.
"Incredible Penny Stocks: What is a Form T-Trade?
There is much confusion and rumor regarding “T Trades” in the penny stock market. Nasdaq Pink Sheet stocks often close at a certain price and, within 3-10 minutes after the closing bell, will show a large final trade that gets labeled as an “after hours” trade. Simply put, this is an inaccurate description of that trade.
To understand how this trade works, one must understand the role of the market maker. The most frustrating aspect of investing in the pennies, is market maker manipulation of the stock price. Anyone that claims this manipulation doesn’t happen truly does not understand the OTC Market. Market makers are in place to “control” the price of a stock and, theoretically, to ensure that the market reacts properly to supply and demand for a certain stock. Unfortunately, when large sums of money and a lack of regulation are involved, more often than not, there is manipulation that suits the needs of certain investors or the market makers themselves. After all, they are in business to make money as well. If the average investor is purchasing stocks in the OTC Market, that investor is truly at the mercy of the market makers involved in the purchase and sale of that security.
When researching this article, The response from the SEC defined a “Form T Trade” a “trade reporting form used by broker-dealer members of the Financial Industry Regulatory Authority, Inc. (FINRA) to report equity trades executed either in the OTC market or during extended hours trading. Recent amendments to FINRA rules will expand the types of situations in which Form T is to be used, but they are not yet in effect.” The response also recommended contacting FINRA. Notice the first portion of the response. “either in the OTC Market or…” Once again, it is confirmed by the SEC that ”after hours” trades do not exist in the Pinks.
FINRA was much less transparent in their response and essentially spewed the same limited information regarding T Trades that is available on their website. None of which, accurately reflects why these trades occur in the OTC Markets. (http://www.finra.org/web/groups/industry/@ip/@reg/@notice/documents/notices/p123750.pdf)
Trying to decipher the meaning of these trades with the limited information that is available on the subject led down several dark paths. Clearly, the average investor is not meant to understand the concept or its rules. Even more disconcerting is the second part of the SEC message “Recent amendments to FINRA rules will expand the types of situations in which Form T is to be used, but they are not yet in effect.” That means there is even less transparency about this mysterious T Trade.
After months of due diligence, there are a few poorly publicized uses for a T Trade. The most important factor here is that the only requirement of market makers by FINRA is that they must report all trades in a day. They are not required to do so when the actual trade occurs.
To avoid creating “an unbalanced market”, market makers often do not report certain trades during the day to the public and then use a T Trade not to “scare” investors into thinking a market for that stock is going in one direction or the other at the spurring of one large investor.
If a market maker wants to accumulate a large amount of a stock in one trading day, that market maker may actually not report any of the trades that occurred until the trading day has ended so as not to alert the market to the collection. This practice is completely legal under the FINRA rules of the OTC Markets so long as the trade is reported at the end of the day.
To execute a Market on Close” order, a market maker may have an order to purchase the stock at a certain price at the end of the trading day. This is the most unlikely scenario because it needs to be assured that someone selling the stock and someone buying that stock are agreeing upon a price. Simply put, this is more likely with insider buying and selling.
The T Trade that the public sees is nothing more than one or all of the above scenarios. The T Trade reported at the end of the day can be from one market maker or many involved market makers. It can be a single purchase price but is usually an average of all of the previously unreported purchases from that business day.
Penny stocks are an exciting and lucrative business. As most everyone will tell you, it is not for the weak of heart. There is definite money to be made in the OTC Markets and more penny stock millionaires are made every day. But the best way to win the game is to know the rules!
One additional fact surfaced about market makers while researching T Trades. Did you know that market makers are not required to honor their offer price? That is correct, because the OTC market is essentially a “best offer” market. If a buyer meets the asking price for a security, the market maker can, and often does, decide to rescind the offer, not sell the security and adjust the selling price.
Happy Trading"
Keeping an eye on it all!!!
After Hours Volume: After Hours High: After Hours Low:
120,000 $ 4.98
(16:54:06 PM) $ 4.872
(16:16:26 PM)
Read more: http://www.nasdaq.com/symbol/fmckj/after-hours#ixzz3XVbofEdQ
After Hours Volume: After Hours High: After Hours Low:
264,000 $ 4.90
(16:42:21 PM) $ 4.90
(16:42:21 PM)
Read more: http://www.nasdaq.com/symbol/fnmas/after-hours#ixzz3XVbVmVlK
We're a special breed. :) Thanksgiving table this year will be entertaining.
I can't imagine anyone wanting to be out over the weekend!
@BlockTradeAlert: BLOCK TRADE (Microcap): $FMCKN 250,000 shares @ $4.35 [15:11:41]
@BlockTradeAlert: BLOCK TRADE (Microcap): $FMCKN 750,000 shares @ $4.35 [15:11:47]
OK, I'm done with my meeting. Let's get this thing back up!! JK
It's heating up. Both sides are coming out swinging!
@PressSec: Req'd reading for today's briefing: @ChuckGrassley urging POTUS not to confirm the next AG in the lame duck Senate. http://t.co/dsyHyPjNQD
Always have to keep an eye on Chicago! :)
Good song for us!
http://video.cnbc.com/gallery/?video=3000371562
@FoxBusiness: Breaking: The House votes 240-179 to repeal Estate Tax (also known as the Death Tax), via @Varneyco
Preferred are having a grand old day! :)
$2.5 million, nice!
@BlockTradeAlert: BLOCK TRADE (Microcap): $FMCKL 598,700 shares @ $4.30 [11:54:10]
Uh oh, Lew is busy that day. He has a telephone meeting with FSOC. He better get busy and give Grassley his answers before. :)
closing argument Greenberg 4/22. What happens in the middle of all this if Wheeler's decision is for the plaintiffs? :) $$$$
Witnesses
Opening Remarks
Mr. Tom Woods
President
Custom Woods Homes
Mr. Chris Polychron
Executive Broker
First Choice Realty
Mr. J. David Motley
President
Colonial Savings
Ms. Julia Gordon
Director of Housing Finance and Policy
Center for American Progress
I agree, very positive. He's driving home the important issues, demanding answers. He's not going to let them distract him, create fodder for the other side by bringing up hedgies etc. The key to this all is staying focused as we see in the court cases. Busy month here!! $$$$
Julia Gordon at the senate banking hearing today that started at 10am. I'll have to go back and pick out the exact quotes. I'm jumping around to all the great events today! Go F $F$$$
Gordon, in one of her answers mentions uncertainty while Fannie, Freddie still in conservatorship
That should be good! Thanks!
After Hours Volume: After Hours High: After Hours Low:
261,000 $ 4.71
(17:01:29 PM) $ 4.71
(17:01:29 PM)
Read more: http://www.nasdaq.com/symbol/fnmas/after-hours#ixzz3XQsVXjXe
More boom boom!
http://www.nasdaq.com/symbol/fnmas
Getting ready for some boom, boom!!
The pressure is on!!
Good to know, thanks!
ePublishing
BackHome
Mortgage lending and finance industry get boost in housing regulatory reform bills
House passes slate of bipartisan bills to ease burden, encourage homebuying
Trey Garrison
April 15, 2015
Email
The home lending and mortgage finance industry saw big gains this week on Capitol Hill, as a number of bipartisan bills from the House Financial Services Committee were passed during “Financial Independence Week.”
“The American dream for so many low and moderate income Americans is that one day they can achieve financial independence,” said Chairman Jeb Hensarling, R-Texas. “We are trying to ensure that low and moderate income Americans have convenience, that they have choice, that they have lower prices.”
Among the most important was the Mortgage Choice Act, which passed by a vote of 286-140. The Mortgage Choice Act of 2015 by U.S. Rep. Bill Huizenga, R-Mich., amends and clarifies the qualified mortgage definition in the Dodd-Frank Wall Street Reform and Consumer Protection Act. It also adjusts the Truth in Lending Act definition of fees and points by exempting points and fees on any affiliated title charges and escrow charges for taxes and insurance from the qualified mortgage cap on points and fees.
“A qualified mortgage is the gold standard of home loans. Hardworking families should not be denied access to a qualified mortgage because of technicalities that are largely out of their control," Huizenga said after the passage. "The Mortgage Choice Act enacts commonsense reforms to Dodd Frank making it possible for low- and middle-income families to achieve a portion of the American Dream.”
Another salient bill passed Tuesday was H.R. 650, the Preserving Access to Manufactured Housing Act, which supporters say ensures consumers – especially low and moderate-income consumers – can continue to have access to affordable manufactured housing. This bipartisan legislation continues existing consumer protections, including protections that prohibit steering consumers to predatory loans.
http://www.housingwire.com/articles/33566-mortgage-lending-and-finance-industry-get-boost-in-housing-regulatory-reform-bills
April, 15, 2015, Financial Institutions and Consumer Credit Subcommittee Hearing entitled “Examining Regulatory Burdens on Non-Depository Financial Institutions” The Committee on Financial Services will hold a hearing entitled “Examining Regulatory Burdens on Non-Depository Financial Institutions” at 1:00 p.m. on Wednesday, April 15, 2015, in Room 2175 of the Rayburn House Office Building. This will be a one-panel hearing and will include the following witnesses: • Mr. Justin G. Friedman, Director, Federal Government Relations, American Financial Services Association • Ms. Diane Evans, Vice President, Land Title Guarantee Company, on behalf of the American Land Title Association • Mr. Dennis Shaul, CEO, Community Financial Services Association • Ms. Paulina McGrath, President, Republic State Mortgage, on behalf of the Community Mortgage Lenders of America • Ms. Mitria Wilson, Vice President of Government Affairs and Senior Counsel, This hearing will examine the impact of rising compliance costs brought on by the Dodd-Frank Wall Street Reform and Consumer Protection Act (P.L. 111-203) on consumers, non-depository financial institutions, and the U.S. economy. In particular, the Committee looks to explore whether products or services are no longer being offered to consumers because of agency actions, and the impact on consumers if they no longer have access to specific products or services. This hearing will also provide Members with an opportunity to hear from industry stakeholders about how the current regulatory environment is affecting their ability to provide services to their customers and examine proposals to afford nondepository financial institutions relief from unduly burdensome or unnecessary statutory or regulatory mandates.
Thanks for tweeting this Sims!
Discussion › Investors Unite Event/Teleconferences › STEGMAN’S REMARKS AT HOUSING BLOOM PANEL DISCUSSION.
Viewing 1 post (of 1 total)
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April 15, 2015 at 9:46 am#5458
STEVES
Participant
PARTIAL TRANSCRIPT OF STEGMAN’S REMARKS AT HOUSING BLOOM PANEL DISCUSSION.
VIDEO AVAILABLE HERE: http://livestream.com/FSRoundtable/HousingBloom
The U.S. Housing Market: Ready to Bloom; Ripe for Reform
Stegman (starts at 1:05:30)
from our standpoint the housing recovery continues to be mixed, with single family starts slightly above the range of recent years, despite declines in the last two months. if we take a longer view, single family starts and new home sales remain very low relative to historical norms. and while multifamily construction has recovered to its pre crisis range, supply.. new supply.. has been concentrated at the higher end of the affordability scale , with supply of more affordable units remaining seriously constrained. meanwhile home prices have recovered much of their decline during the housing bust, lifting millions of homeowners out of negative equity . home price appreciation has moderated from the rapid pace of 2013, many analysts expect a further modest slowing in the year ahead, there’s some variation in analyst views there, still housing doesn’t seem to be overvalued in our view in the aggregate. The distress associated with the housing bust continue to wane, delinquencies foreclosures and distress sales all remain on a downtrend. and while home price appreciation has eroded housing affordability, affordability still remains above its historic norm, and furthermore mortgage credit availability we think should increase as the economy continues to strengthen. Improving economic conditions should continue to provide some support for the housing market going forward, and while mortgage rates are relatively low, strict lending standards continue to remain in place and wage growth continues to be subdued. these factors, along with all-cash single-family investors pulling back from the market will likely lead to moderation in home price growth. Additionally both supplies of new and existing homes remain tight which will continue to constrain sales growth in the near term, is our view.
******
******
1:19:00
Mr Leonard asks Stegman:
Why is housing finance reform still needed?
Let me just start with, you know the market is functioning now, why is reform still needed??, I’ve said it many times before, but the status quo is unsustainable for a number of reasons.. one the taxpayers again remain at risk, market participants are truly uncertain about the government footprint in the market, that’s not good for mortgage credit, and quite frankly access and pricing decisions ought to be in the hands of private market actors and not government agencies. and the only reason the market is ..in your terms paul [leonard] functioning now, is because the conservatorship has preserved a key feature of what we keep referring to as the GSE’s flawed business model, it’s the implicit guarantee of the government that comes at taxpayer expense and I’d like to use this time to correct the record as well as answer your question. Let me remind everyone, that in public filings since 2008, Fannie and Freddie have stated that they are no longer being managed for the benefit of shareholders. As Treasury Secretary Hank Paulson stated on September 7, 2008 and I quote “because the GSEs are in conservatorship they will no longer be managed with a strategy to maximize common shareholder returns, which historically encouraged risk taking”.
Under the Preferred Stock Purchase Agreement as entered into in 2008 there is no mechanism for taxpayers to be repaid for the value of the capital support and backstop that has been provided to the GSEs. The dividends that Treasury receives are not a repayment for the capital support and backstop that treasury has provided. Pursuant to the terms of the PSPA, the GSEs are required to pay treasury each quarter a dividend equal to their net worth over applicable reserves amount. These are not a repayment of the treasury’s provided. The fact is that the PSPA provided tremendous value to the GSEs. market participants continue to have confidence in the GSEs and continue to buy 30 year securities because of the remaining capital support left under the PSPAs. The capital support also gives the GSEs access to low borrowing costs. So the dividends Treasury receives must be viewed in light of the value of the extraordinary commitment Treasury and the taxpayers made and continue to make in the GSEs.
So if Congress fails to act before the next crisis, by virtue of the PSPAs Congress could be called on once again to bailout .
The best time to act on housing reform is when the housing market is well on the path to normalizing, not on the precipice of a new economic shock. Now the remaining undrawn taxpayer commitment to the GSEs is 258.1 billion dollars. It is the fact that taxpayer continues to provide the GSEs with this extraordinary capital support that gives the market confidence in their solvency, not the GSEs’ de minimis capital buffer which have been the topic of much recent attention. Despite their vanishing cap buffer, spreads on Fannie Mae and FreddieMac MBSs are at historical tights. As Goldman Sachs recently highlighted they didn’t widen significantly, indeed they didn’t really widen at all in response to the release of 4th qtr earnings report or the FHFA IG report that many point to. The fact is the agency MBS market remains one of the most liquid fixed income markets in the world despite the fact that the companies have minimal capital levels. And although taxpayers remain exposed to potential future losses of the GSEs through the PSPAs, let me remind you that both recapitalization and draws against the existing Treasury backstop due to potential future losses both come at taxpayer expense. The only difference is that recapitalization costs would be borne by taxpayers immediately while a draw is a future contingency.
So that is why comprehensive housing reform is the only way to responsibly end the conservatorship of the GSEs.
*******
1:39
I mean theres nothing that Laurie said that I would not, and we would not agree with .. we have talked about the importance… you talk about front end, before delivery, before the GSE guarantee credit enhancing, we think that its very important to broaden as much as possible the variety of credit risk transfer mechanisms, to broaden the investor base, so we think the conservatorship is just doing as much piloting, testing and price discovery front end and back end as possible to give more data points to congress and others as possible.. as you begin to think again about permanent kind of fixes to the future system.. with respect to the platform ummm you know again Laurie mentioned it.. this is a very heavy investment that taxpayers are footing the bill for. There’s not a vision for a future system that doesn’t really have a role for a market utility that serves the broad securitization needs of the market ,not just further institutionalizing the role of a duopoly in the future system and so what we’ve said is it would really be important for the longer term vision of the platform to include that next stage, that next phase, which is how do you get from the kind of e plumbing to serves the needs of fnma and freddie versus a larger market need. and we’ll continue to have those conversations.. one last thing.. we are very supportive of the development of the credit risk transfer market, and what we can learn from all of these transactions. So in order to help understand what is required for further development of that market we have convened an intra-agency working group to explore what the implications are for various regulators and others in the development of that market.
I think thats just reflecting the importance of private capital taking right credit risk before the government guarantee which we see increasingly as a catastrophic risk guarantee.
*****
what has been Treasury’s efforts to build confidence in the purely private mbs mkt?
we’ve certainly talked about from a broad housing reform standpoint.. we think it important to have a healthy robust responsible non-guarantee securitization channel.. or MBS private label security and so on.
we all know the problems and breakdowns leading up to and into the crisis and we’ve been working with market participants, structured finance industry groups and others about what kind of reforms needed to get the kind of confidence of the institutional investors back into this marketplace and i think we all kind of recognize that as we’ve been talking about first loss credit risk and so on that if you think about the non guarantee market 90% or more of the transactions really are around who is going to buy the triple-A the senior bonds, and those purchasers are out of the market.. those big investors, the asset managers, the Pimco’s, Black Rock, Met Life, those who buy these bonds are just not coming back without structural reforms that give them confidence in the collateral and in protecting their rights and so on we’ve been working with the industry a lot on what it would take to bring back that confidence and we’ve developed a concept of a benchmark transaction..while a lot of really good work is going on in the industry to develop consensus standards , we’re working with subgroups of the industry around what the terms and conditions for a significant transaction might be , that would put in place sufficient investor protections that would give these big institutional investors the confidence to come back and invest in a significant transaction, and we are bringing to Treasury at the end of the month the market participants who have indicated the strongest interest in the concept of a benchmark transaction to talk about the progress that they’ve made and i will say and i’ll have more to say about this in a conference in a couple weeks but part of a center piece is around the role of a new player if you will in these transactions, the independent deal agent who represents the interests of the investors who would really be at the heart of determining whether there are breaches in the reps and warrants reporting that to the trustee, having some duty to serve, other real protections that a number of investors have been interested in, and well be talking about the development of that concept in the coming weeks.****
I would just like to say something about the affordability issue.. i couldn’t agree more with Laurie that that is a key element. we argued outside that as a part of housing reform that there are other ways of doing affordability and supporting borrowers and those the market couldn’t support without subsidy but within the conservatorship there are a set of affordable requirements and mandates that the GSEs continue to have to meet and we are bringing increasingly private capital in front of the GSE guarantee.. Laurie talked about the portion of the book that is risk shared and thats going up and up and will go up significantly. i think that within the conservatorship if you can prove that you can protect the affordable housing requirements of the GSEs as private capital continues to take more and more of that credit risk, that should be a pretty important set of data points for the next round of housing finance reform legislation. So I would look for that very important part of the evolving conservatorship..
http://investorsunite.org/discussion/topic/stegmans-remarks-at-housing-bloom-panel-discussion/