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It is a good article. BUT...
what do you do?
If there is no legal way to force Watt to perform within his statutory role/functions, then what for?
Does this have the potential of killing innovation?
This will backfire.
I still cannot tell the significance of Weiss.
However, with the new Calabria/Krimminger paper, recent words from Shelby of getting FF back on their feet as fully private entities (I guess that is what it means no gov. backing) and given the past relationship between Calabria and Shelby there may be some hope that Weiss may indicate *restructuring* coming.
This aside, I think Japan and Europe will be fine. Measures of narrow money indicate substantial growth coming within a quarter or two. I think LD is correct in that oil will bounce. Not sure how much, maybe it trades by 60-70 by years' end. This is also consistent with what happened in 1986/1987. Maybe we shoot straight up and see a 1987 style crash in 2016/2017?
Pittenger on Twitter
http://www.thestate.com/2015/01/30/3959920_pittenger-v-watt-new-guard-goes.html?rh=1
Interesting he was twetting while the hearing was going on...
Agree. Third amendment is the issue.
Thank you.
going to do??
This is a good article that went unnoticed.
I think...
I do not want to get too excited.
The U.S. Court of Appeals for the District of Columbia, which is known to target administrative flip-flops, took the case.
It struck down the 2010 interpretation, invoking the so-called "Paralyzed Veterans doctrine," a reference to a 2007 ruling that said government agencies must follow notice and comment requirements of the Administrative Procedures Act when making significant changes to rules.
Last year at this time we were told that the reason pfd was holding up so much better than the common was the pfd had some value in liquidation.
Given that the plaintiffs maintain no current right to a liquidation preference while the GSEs are in conservatorship, the plaintiffs are no worse off today than they were before the Third Amendment. Therefore, there is no hardship imposed on the plaintiffs by withholding court consideration until this contingent right matures at the moment of liquidation. The right to this elevated preference for asset distribution, given to preferred shareholders under GSE stock certificates, is only triggered during liquidation.
He did vote against.
From Politico.com (June/July)
A Shelby chairmanship would also likely throw a wrench in the bipartisan deal struck in the Senate this year on housing finance reform. The Senate Banking Committee recently approved a bill authored by Senate Banking Chairman Tim Johnson (D-SD) and Crapo, which was backed by much of the industry as well as the the Obama administration, to do away with Fannie Mae and Freddie Mac and put in place a new mortgage financing system.
Shelby voted against the bill out of concern that it leaves too much of a government role in the new system and as chair of Senate Banking he would be unlikely to revive the bipartisan proposal.
“We have seen what happens when government becomes too entrenched in housing and the system becomes too complicated, even for regulators to oversee,” he said when the committee met last month to vote on the bill.
Read more: http://www.politico.com/story/2014/06/wall-street-mississippi-senate-primary-107361.html#ixzz3FMwLTfR4
I am also adding this...
This bill (Delany Bill) was introduced mid July. It has 13 co-sponsors already. It's not dead and perhaps it revives right after November. It is the only bill that deals directly with the SPSPA's:
(5) RESTRUCTURING OF SPSPA.—The receivership shall provide for the restructuring of the Senior Preferred Stock Purchase Agreements entered into between the Department of the Treasury and the enterprise on September 26, 2008, as amended and restated thereafter, to—
(A) permit the redemption of senior preferred shares of the Department of the Treasury;
(B) provide for the cancellation of the warrants for the purchase of common stock of the enterprises issued to the Department of the Treasury; and
(C) provide for the appropriate level of compensation to the Federal Government for the financial support and commitment provided to the enterprise.
That is only a perception. And perceptions are volatile.
A change in perception could evaporate an opportunity quickly.
Dividends rely entirely on money available in the account# retained earnings of the companies' balance sheets being the central issue recapitalization. The route to dividends are many and varied. One route -the DTAs coming back to the companies in full- has been hit. But, even this one route is not gone completely but suffered a first blow. Given the judiciary system structure (district courts, appeals court and Supreme Court), this is a minor blow.
If you believe:
- an appeal could reverse or partially reverse Lamberth's decision,
- that SCOTUS may still be where Perry's will end,
- that Sweeney's court will move forward with Fairlhome's case,
- that the new Congress may bring new, different schemes perhaps friendlier to shareholders,
- that conservatorship will not last forever with Treasury skimming the bottom line and that either reform or restructuring may be in the cards.
then, -at these prices- Jrs. are just about the same bet as they were when the 3rd amendment was announced and we all dropped from our beds and spent weeks and months in disarray. Sometimes even regretting the trade.
Those looking from the outside may see this as the last opportunity to build a position at reasonable prices. If you believe that the companies may stay -even if reformed- and shareholders may play some role -even if minor-, then the dividends thesis has not changed. The large drop in prices bears no relation to the original thesis which hasn't changed. In other words, if someone invested in Jrs. the day before the drop there is no reason to be out today.
Lastly, don't forget this important detail. We do not know the views, backgrounds of the -potentially- 3 judges that will handle Perry's appeal. But we do know now Lamberth's personal views. In spite of his ruling, he himself questioned the 3rd amendment by bringing up "feelings of discomfort" or it being a deal that raises eyebrows. All after stating it was not up to his court to assess the morality or fairness of the amendment. If a judge who strictly followed the letter of the law is questioning it's spirit, what are the chances that 3 different judges may not feel the same and may want to rule differently?
Joe... what's your take on the current situation re: Jrs.?
Re: disposal of assets power
but future earnings are not an asset.
The risks of subprime going forward are not that there will be too much of it; the danger is that there will be too little.
Thank you for taking the time to answer.
I'd like to think she reached her conclusion hastily by applying the benchmarks of the other 2 FIRREA cases but in reverse. Those were "exempted" cases and this one -using those same benchmarks- isn't, even when this one is a HERA case.
However, as we see in Fairholme's case, determining whether FHFA and Treasury are distinct entities (for the purpose of the 3rd amendment at least) is not a simple matter that relies on how many employees they shared or didn't share.
I am thinking that if Cooper can prove that FHFA has been taking orders from the Treasury, then, the decision on this derivative case could be revised by a higher court? Become an exemption to HERA?
And one inquiry, if I may... could agencies such as FHFA engage in policy-making? Is this within the realm of FHFA activities? And if not, winding down, reform and protecting taxpayers should not be a concern of FHFA's head, no? I am trying to anticipate whether Defendants in Fairholme's case will try to pull something like "FHFA and Treasury are distinct and separate BUT happened to have the same goals and missions". Yet, only Treasury can engage in policy-making if winding down the firms happens to be such. Sorry if this is confusing... Can you point me to where I can find some answers, please?
A coalition of 17 conservative and free-market public policy groups sent a letter to...
A coalition of 17 conservative and free-market public policy groups sent a letter to the ranking members of the House Finance Services Oversight and Investigative Subcommittee
The letter reflects growing awareness of the secrecy with which the federal government has responded to legal challenges to the seizure of private assets as part of the six-year conservatorship of the GSEs.
Dividend!
Just got this on my etrade account
Security: ***MECHEL OAO (MTL.PR)
Amount Credited: $69.80
Most, if not all software for message boards and forums include a feature by which a moderator or administrator can designate -usually valuable topics- a thread as a "sticky". Then, that one sticks at the top of all threads until the moderator or admin changes back the status to "normal".
So, yes, this applies to the web in general as you may see it in many other forums.
mod is short for moderator.
No problem.
"stickied"
to stick an important thread at the top so that it remains there no matter how many threads get started afterwards. This is to prevent "losing it" as it would naturally roll down. Mods can do this.
Are you saying you want to use your OTC stocks as collateral?
What she wants is to determine whether FHFA is the United States or not.
She meant: FHFA acting as an arm of the Treasury. Thus, Treasury being on the driver's seat.
But Defendant already muddled the waters. US lawyer already told the Judge that FHFA can be the US, can be FHFA as an independent agency and can be both a conservator and a regulator. In other words, a chameleon that will take each convenient role to obfuscate Cooper every time he comes back to bite. Problem is that Judge Sweeney was also fine with that definition of "what is" FHFA.
All the apparent confusion that comes from the US side is in purpose. Not incompetence. It's a strategy.
Ah... that is different. I may have misunderstood him. Yes, that is very possible. I myself working for corporations used to keep copies of potentially damaging information in case someone wanted to give me trouble. He (and you) could be right that a lower level employee may already have copies of possibly damaging documents. All speculation, anyway.
Cooper made a very lame attempt. Given the risks and dangers I am surprised he did not continue to press the Judge. Let's wait for the motion to compel, if it ever comes to that. I am thinking on emailing their Law office. And the court itself. If courts don't like to receive public opinion/complaints, then proceeds should be private. The Judge should take this seriously. It is a serious matter not just "letting plaintiff have their day in court".
And that's the point. Read my posts. The Judge warned the government at the end -it's in the transcript- to not hide documents that will answer the question whether the FHFA is the United States or not. How hard will it be to find these documents? Now that they know exactly what to hide, how hard will it be?
The discovery process has been narrowed in time and in scope. If you simply change the dates of some documents they will instantly fall out of reach. That hard.
It is not that plaintiff has full access to all hard drives and all office documents as if they were the FBI raiding FHFA headquarters. Plaintiff relies on documents provided by the government. Documents that seek to incriminate both the FHFA and Treasury.
Don't think so... remember the Judge said anything leaked will become unusable for court proceedings. Plus other severe punishments.
Basically, she says to the government "you can conceal and I will make sure it is not leaked".
I don't have the answer, Beta.
Or maybe I do.
I was just surprised that she did not order the government to supply the hit report "as is" during the conference. Instead, she said repeatedly she wasn't going to issue any orders right at the conference and requested the parties to negotiate. Cooper actually said something in the order that hit reports are non-negotiable (he did not use those words). But made it explicit that it was "de rigueur" procedure. I keep asking myself what was she thinking? Trust the government? Really? If that is what is behind it -trust the government to do the right thing- yes, we are on our own.
This is her illogical behaviour:
The lawsuit is about government overreach. Yet, by not making mandatory the issuance of hit reports the assumption is that government on their own will produce the truth. So are you trusting a government that is accused of overreach? Hello?
The Judge was out of focus. She wasn't in the case. She first "got mad" because she wasn't warned beforehand about the topics that were brought up. Then, she sidestepped the above critical point. And -all in all- caved in to government delay tactics. Her warning at the end wasn't to be taken seriously... if I were the government.
I am still fuming that she laid it out for them. She said something like this "do not leave out documents that should answer the question whether the FHFA is the United States". Now they know EXACTLY what to leave out.
Instead, she should have established a way for this not to happen. Cooper, where are you??
After reading the transcript I believe the government will not play nice, will not cooperate, will muddle the waters to the limit and will thoroughly screen documents out to only hand in those that are useless for plaintiff. What makes Judge Sweeney's warning silly is that it cannot be enforced. Who is going to oversee the Defendant's actions to make sure they stick to this warning?
If she wasn't straightforward about the hit reports, one of the few ways to see if the government is cheating, how in the world will she (and plaintiff) ever know that the government is not "accidentally" leaving critical documents out? Worse yet, now that the government has been warned about the needed consistency between hits and final output who will supervise that the numbers aren't fudged? Where is the transparency in all this?? The hit reports aren't a public document either. This can be forged as well. Hey, we've got 1900 output docs, let's make it 1901 hits!
Now imagine this comical situation where someone at Treasury or the GSEs finds a letter signed by Geithner telling DeMarco to transfer 100% of all future profits for eternity to massacre both the companies and shareholders while flooding government's coffers with needed funds and the person finding the document cheering loudly because they can finally comply with the Judge's warning of sending specific, clearly written documents that state the Treasury was in the driver's seat.
You really have to laugh if you think the Judge seriously considered that the government will do this on their own, unsupervised. Like telling a drug addict alone in a room full of the most potent drugs to abstain... on his own, unsupervised and nobody ever to know whether any drugs had been used or not.
Has plaintiff filed their motions to compel yet?
The Court: But if you’re -- I don’t want instructions to be given to clients or to these entities (GSEs) that they don’t have to produce certain documents if, in fact, it’s going to answer the question, were these entities part of the United States Government. Were they controlled by Treasury? If that’s what the documents show, I realize I’m preaching to the choir saying that, you have to turn it over to Plaintiffs.
So, if you’re invoking privilege to block the Plaintiffs’ entryway into the courthouse door, you can’t do it. I know you know that, but you can go back and tell your clients I said so, and that might either make their life easier or more difficult or perhaps both, depending upon which issue you’re discussing.
So where is J. Sweeney's new order?
Can anyone post a link, please?
From that article, the most important part is the subtitle "As more layers peel away, a pattern forms".
Forming a pattern is critical for the lawsuits as the pattern can take the place of what the government is trying to hide: the deliberative process that shows the cards. By establishing a solid pattern a casual observer will be looking at the result of that deliberation, like a mirror, and successfully reverse-engineer it.
Hot water, baby.
I don't know if Ugoletti lied or not but I imagine many involved are starting to feel the heat.
And if I may add some more...
Judge Sweeney granted discovery from June 2011 through August 2012, as opposed to government's request of only January 2012 through August 2012.
From JUNE 2011, right after Blackstone's presentation! What a marvelous coincidence!
And I should add...
good luck having J. Lamberth not seeing the capricious nature of the sweep amendment.
What matters from that report is on page 35 where Blackstone communicates to Treasury "Private capital will not make a substantial commitment to a solution in the absence of any likelihood of a meaningful return of capital" and then they add this critical line:
The first step in demonstrating the possibility of a return on capital is to generate capital to build more stable balance sheets