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1:59 pm Freddie Mac: 2015 Economic and Housing Outlook (FMCC) : FMCC expects 2015 home sales to be the best since 2007 with mortgage rates low, purchase applications up and pending home sales on a positive upward trend.
Revised down forecast for economic growth for 2015 from 2.8 to 2.6 percent.
After a cold winter, the forecast for housing starts of 1.15 million in 2015 is slightly lower than last month at 1.18 million. However, expect pent up demand from the chilly first quarter to bolster home sales in the succeeding quarters. Forecast for total home sales of 5.6 million in 2015 is unchanged.
Expect house prices to increase 4.0 percent in 2015, a slight increase from last month's projection.
Expect lower mortgage rates to boost the refinance volume share of originations in 2015 to 41 percent.
Forecasting mortgage rates to drift slightly higher over the next six months, increasing more around the end of the year when it anticipates the Fed will begin raising rates.
@BlockTradeAlert: BLOCK TRADE: $FNMAT 700,000 shares @ $6.97 [12:07:28]
Next status conf could be 4/22 also
He probably paid for the spot to try and annoy us :)
4/22 closing arguments
Well written, MB, thanks!
It seems like he doesn't like shareholders, shareholders' democracy? :)
I don't see any congressmen referencing any of Carney's pieces like they have with Morgenson's articles?
WASHINGTON – Sen. Chuck Grassley of Iowa, Chairman of the Judiciary Committee, is seeking answers from the Administration on why it reportedly won’t disclose documents regarding the relationship between the Treasury Department and mortgage financing firms Fannie Mae and Freddie Mac that resulted in billions of dollars going to Treasury. News reports also suggest that the President has invoked executive privilege over some of the documents relating to the issue.
“The taxpayer has a right to know what has transpired,” Grassley wrote in separate letters to Attorney General Eric Holder and Treasury Secretary Jacob Lew. “But, instead of transparency, there appears to be an invocation of executive privilege. If true, this is cause for concern.”
Grassley based his letters on a New York Times report regarding the lack of transparency and assertions of executive privilege surrounding Fannie Mae and Freddie Mac’s arrangement with Treasury. Grassley writes that it is unclear whether the President himself asserted executive privilege to withhold documents and whether the Justice Department was authorized to do so. The news reports describe that the assertion of executive privilege is being used to withhold documents that by definition are public, such as news releases.
Grassley’s letters ask a series of questions to acquire the details of the assertions of executive privilege and to gain insight into the Treasury agreement and how the earnings flow complies with statutory requirements on sound conservatorship of Fannie Mae and Freddie Mac.
Grassley’s letters are available here and here. The New York Times piece that prompted his interest is available here.
http://www.grassley.senate.gov/news/news-releases/grassley-seeks-transparency-over-administration-decisions-fannie-freddie-earnings
Market Capitalization $3.08B
Shares Outstanding 1,158,083,000
Shares Short* 135,468,832
Short Interest as a % of
Shares Outstanding*
12.12%
Days to Cover 14.27
P/E (Trailing Twelve Months) --
PEG Ratio (5-Year Projected) --
Ex-Dividend Date --
Dividend Pay Date --
Dividend --
Dividend Yield (Annualized) --
* Shares Short and Short Interest data provided by NASDAQ, NYSE, or AMEX and is updated periodically and on a bi-monthly basis (depending on the listing exchange).
Nice performance! I hope Ackman comments on the recent news.
I see why we've moved on to tweets!
Lol! I'm just glad we're all going to be rich and toasting it soon!
Thanks for standing up to Carney, WildTwins. Why is he such an ass to shareholders?
Wow!!! What is Carney's deal? Whew!!
What does more, "elastic" mean? :)
Just stirring it up Boston. :) I was eager to watch Gasparino's coverage, and appreciate any of the commentators who give an effort to get the message out there!!
True, but there were a lot of indicators pointing to a possible decent rise mid-February. :)
Carney has been at it for quite a while. Here's an interesting article from 2010.
New Capital Requirements Threaten To Stick Us With Fannie Mae Forever
John Carney | @carney
Friday, 3 Sep 2010 | 2:52 PM ET
Global banking regulators may be close to reaching a deal on bank liquidity requirements that could saddle the U.S. taxpayer with supporting Fannie Mae and Freddie Mac for eternity.
The committee drafting the new Basel III rules will meet in Switzerland next Tuesday. A final set of rules is expected to be agreed on September 12. The leaders of the Group of 20 nations are expected to endorse the rules when they meet in November.
A little noticed change in the proposed rules, however, could throw a monkey wrench into plans to reform Fannie and Freddie, the two mortgage giants that have spent the last two years on government life-support. So far, U.S. taxpayers have been forced to pony up around $150 billion for Fannie and Freddie, and the Congressional Budget Office says that the total cost could amount to three times that much.
Policy makers who hoped to eventually remove the costly government subsidies and guarantees for Fannie and Freddie will run into a stumbling block, however, if the Basel III rules are implemented. That’s because Basel III includes a liquidity requirement for banks that will encourage them to buy the debt of the Fannie and Freddie as well as the mortgage-backed securities they back.
The new liquidity regulation—sometimes known as “The Bear Stearns Rule”—is intended to make sure that banks have enough “high-quality liquid assets” to survive a temporary credit crunch. Specifically, the banks will be required to have enough high-quality liquid assets to fund 30 days of capital outflows under a stress scenario.
Right from the start, the way the Basel Committee defined “high-quality liquid assets” was problematic. It included cash and central bank reserves, relatively non-controversial highly liquid assets. But it also included sovereign debt, a move that would inevitably encourage banks to hold more sovereign debt than they otherwise would. This is problematic for two reasons—it created an implicit subsidy for spend-thrift governments and it created the danger of over-exposing banks to sovereign defaults.
Recent amendments to the Bear Stearns Rule have extended this subsidy to Fannie and Freddie. The Basel Committee decided to include the debt of “Government Sponsored Entitites”—bureaucratic code for Fannie and Freddie—in the definition of “high quality liquid assets.” What’s more, it also included mortgage-backed securities guaranteed by Fannie and Freddie in the definition.
Up to 40% of a bank’s liquidity reserve can be made up of GSE obligations, under the rules likely to be approved in the next few weeks. And while it is true that these obligations get a 15% haircut under the rules because they are considered “Level 2” liquidity assets, compared with the cash, central bank reserves and sovereign debt that will now be considered Level 1 assets.
This creates a huge subsidy for Fannie and Freddie. Banks will load up on GSE obligations, especially in an era where central bank reserves and Treasury bond yields are being depressed by policy-makers seeking to keep sputtering economies afloat. This artificial demand will scramble market signals about the risk taken on by Fannie and Freddie—all but ensuring that Fannie and Freddie will once again unwittingly take on more risk than they can handle. In short, the very same toxic situation created by the once implicit government subsidy of Fannie and Freddie is being baked right into Basel III.
Perhaps even more troubling, this will create a vicious cycle that will make reform of Fannie and Freddie next to impossible. Once banks have loaded up on Fannie and Freddie obligations, there will be no way for the U.S. government to remove government guarantees without triggering a liquidity crisis in banks around the world.
Imagine a bank that is estimated to require $10 billion in liquidity assets to survive a 30-day credit crunch. Under Basel III, some $6 billion of those assets would be Level 1. Some $4 billion would be Level 2, which includes highly rated non-financial corporate debt and GSE obligations. Let’s say the Level 2 assets are split between corporate and GSE obligations.
If lawmakers on Capitol Hill passed reforms taking Fannie and Freddie out from under the government umbrella, that bank would immediately find itself with a 20% shortfall in its liquidity assets. It would have to sell the GSE debt or other assets worth $2 billion in exchange for cash to make up for the shortfall. But it would be doing this at precisely the moment that every other bank was trying to sell its GSE debt and raise cash.
The domino effect of this would be devastating. It has all the makings of another banking crisis.
Which is why it wouldn’t happen. Any attempt to reform the GSE’s would be met with the certain knowledge that the reform would precipitate a crisis. And so the reform would be put on the back burner.
This is what Basel III threatens—Fannie and Freddie forever out of reach of financial reforms, forever subsidized, and forever unable to manage their own risk because of their immunity to market
discipline.
http://www.cnbc.com/id/38953848
Dear Shareholder,
The following article by Gretchen Morgenson, published in The New York Times yesterday evening, highlights the growing congressional scrutiny of the Treasury Department’s legally questionable actions toward Fannie Mae and Freddie Mac.
“Charles Grassley Questions Diversion of Fannie and Freddie Earnings”
Kind regards,
Investor Relations
Fairholme Distributors, LLC (4/15)
Fairholme Funds, Inc.
4400 Biscayne Blvd.
9th Floor
Miami, FL 33137
The rise in February wasn't due to Gasparino, he just reported info. He chased it a bit, (tips from mm's). It had already started the day before. Gretchen's other article came out that weekend too. :)
@VP: In the budget, we’re proposing $300 million in funding to create a more elastic and diverse housing supply across the United States.
Cramer didn't seem like he was in a very good mood today? :)
I bet Berkowitz was in a good mood. AIG had large call buying activity today.
They probably have to cover their shorts first.
I really like how Grassley sent the letter yesterday on the 7th. He didn't wait until everyone gets back from home district work period on the 13th. :)$$$fnma,fmcc$$$
US: CBO budget report ests -$44b UST budget balance for month of Mar'15 vs -$37b in Mar'14. Entitlements rose, and "payments to the Treasury from Fannie Mae ( FNMA) and Freddie Mac ( FMCC ) were $15 billion lower" from last yr.
Thanks for the interesting background info, H!
This is big! Along with William Isaac's article, people are fed up, time for answers, time to do the right thing. Lucky ones getting this still under $3, IMO!!
Fed releases minutes from last month's meeting at 2pm EST. Activity here always seems to slow to a trickle while waiting for the update. Things should pick back up after that!
$$$fnma,fmcc$$$
He has this posted :)
@carney: Grassley also asked Justice Department about legality of profit sweep. Expect hosannas from $fnma $fmcc longs. http://t.co/VO0JUcP6VU
Rafferty Capital Dick Bove Highlights 'Gargantuan' News on Fannie Mae
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Price: $2.65 +6.43%
Rafferty Capital analyst Dick Bove weighed in on Fannie Mae (OTC: FNMA) after what he called "gargantuan" news.
Bove notes, "Senator Charles Grassley (R.; IA), the head of the Senate Judiciary Committee, has apparently sent letters to the Attorney General and the Secretary of the Treasury requesting information on the why and how of the so-called Third Amendment. This is the amendment to the Senior Preferred stock of Fannie Mae that allows the Treasury to expropriate more than 100% of the company’s earnings each quarter."
He continues, "Senator Grassley wants to know why the Treasury refuses to provide any information concerning the decision to create the Third Amendment, to the courts. He also wants to understand why the actions taken by the Treasury were legal."
"This is the right guy asking the right questions at the right time. He is doing it because the Administration may have overplayed its hand in dealing with Fannie Mae. The Administration is taking all of the capital out of the company and intends that by 2018 it will have no capital at all. At the same time, the Administration and its dupe the Wall Street Journal are claiming that Fannie Mae will need another taxpayer bailout."
"Finally, it is beginning to dawn on the Congress and the somnolent press that this makes no sense. One cannot bankrupt a company and then claim that it needs help."
"The world is waking up to the outrages here," Bove exclaims. "What seemed so bleak in this situation a week ago has now been meaningfully reversed."
The analyst has a Buy rating and price target of $4.75 on FNMA.
For an analyst ratings summary and ratings history on Fannie Mae click here. For more ratings news on Fannie Mae click here.
Shares of Fannie Mae closed at $2.49 yesterday.
http://www.streetinsider.com/Analyst+Comments/Rafferty+Capital+Dick+Bove+Highlights+Gargantuan+News+on+Fannie+Mae+%28FNMA%29/10442058.html?si_client=st
Yes, email, Facebook, tweet, twit whatever it takes!
Perfect!! Will do!!
I feel like sending that article to everyone in the country! ;)
Thank you Rey!! Awesome news!! Thank you Gretchen!! Thank you Grassley!!
Love it!! Finally, someone asking the right people, the right questions and demanding answers, with a deadline!
Hmmm, Congress is at Easter District Work Period (Easter vacation :)) still this week. They don't report back until 4/13. I thought there would be some sneaky grass/roots movement happening this week? Let's at least hit the ground running when they get back 4/13. We only have until summer break again to make much stride with congress. :) Let's go!!!
Oh good! My indicator shows it floating up by mid-month.
and today is 4/7. I better mark your post!
Here was a post from Zargis,
"I remember reading in the news a while back that a verdict should be reached by April 30th in the Starr case.
May be incorrect, but it seems possible.
-zargis"
Another article guessed 45-60days?
My guess is closer to Zargis.