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Dollar land soon!!!
a big run ahead no doubt.
Sell. I need more cheapies.
You are the General of Qs. Following closely behind you Sir.
I am saddled up and closely following General Detearing.
A diamond in the rough .... one day it will be found, cut, and held to the sun.
it has and remains a long wait for IMSC to get airborne. Still in big time.
and remember the BD Directors has supreme DC heavy hitters
the potential at IMSC will be seen by lobbyists too- they will want the future business, big business.
The rub is exactly the commons. If there legislations, then the commons are gone. Fact dudes.
The Wall Street Journal
REVIEW & OUTLOOKAugust 16, 2013, 7:03 p.m. ET.Fannie Mae's New Fans
Wall Street smells a payday in reviving the mortgage bailout king..
Article Stock Quotes Comments (2) more in Opinion | Find New $LINKTEXTFIND$ ».
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President Obama said last week that he wants Congress to close down Fannie Mae FNMA +3.03%and Freddie Mac FMCC +1.60%. But that doesn't faze Bruce Berkowitz, the manager of the $8 billion Fairholme mutual fund, who says he's bullish on the government-run mortgage bailout twins and wants to increase his investment.
Our Journal colleagues report that Mr. Berkowitz thinks the mortgage giants are "a very important element of the U.S. economy" and that Congress will choose not to shut them down and will eventually spin them off to private investors.
This is not good news, but it is predictable. As the housing market recovers, Fan and Fred are making money again, and private investors smell an easy political mark. Like Mr. Berkowitz, they figure Congress will find it impossible to resist the attraction of some kind of Fan and Fred cashout, which would give the politicians more money to spend. These private investors, in turn, will become another political force against winding down the toxic twins.
This is one reason among many that we urged Hank Paulson, the Treasury Secretary in 2008, to put the companies in receivership. He chose conservatorship instead, which means the companies can return from the dead to haunt the capital markets again. The combination of private profit and public risk is what made Fan and Fred so politically powerful, and so economically destructive, and here we go again.
Not so Ob. Memories become foggy overtime if you know what mean, quote the Jack. Trend continues down is my guess. Congress will make likely make more noise and take further action for and towards reform.
Ob- LBJ and his boys were brilliant.
If they are merged i believe commons will be gone. This was one of the reasons why FnF failed earlier- the pressure to make yield. If there is legislative deadlock - then my man - you are sitting on a gold mine.
Still resetting
A giant in the making.
To be honest this piece is a bit of a joke. Credit risk has been forced out of the market (only high FICOs) and interest rate has been injected big time (30 yr morts at 4%!). I do agree with the conclusion though - work with what you got.
We got royally hosed Monday a week ago!
Bad news that Senator Jack Reed is not moving on a bill. One more rock in our pockets bringing a slow drop down to what a buck or so. Final legislative action is very unlikely any time soon - if at all -- so time is on our side but I looks like a rocky road ahead for how long? That is the Q. Time to steel up.
Stop chasing your tail. She will slowly down now. She rise again but not for months says this blind mouse.
We got hosed Monday. FNF must reset to acct for the greater risk.
One the nosey on that one. HP was way over his head. That gets to his boss. I like W. but man as a pres. he was one lost sheep.
I agree - he spoke like a Harvard lawyer.
Not im my view. That is about 90% of all new mortgages are being bought by FNF and FHA. Why? Because of the huge interest rate risk with such low rates. As the rates head up that is when the pressure for real "reform" will begin because then Wall Street can make $$$.
That is true overall but the legislative landscape has changed at least for now -- and not in favor of FnF. The US Senate is big deal and Corker/Warner have the big "mo" right now.
Here's the good news on the "wires".....
Window Closing
As the housing market turns around, the window could be closing for lawmakers to act before the current system becomes entrenched.
Fannie Mae and Freddie Mac, which have each been profitable for more than a year, this week announced they’d send a combined $14.6 billion to Treasury, bringing their total payments to taxpayers to $146 billion since 2009. The government takes all of their quarterly profits, which count as a dividend and not as a repayment of the bailout money.
Shareholders in the two companies, long thought to have been wiped out during the financial crisis, are starting to object to that arrangement now that it’s conceivable the government could end up with a net profit on the bailout.
Investors including hedge fund Perry Capital LLC and mutual fund Fairholme Funds Inc. have sued the U.S. in the hopes that shareholders could recoup some profits. They’ve also been lobbying Congress to allow Fannie Mae and Freddie Mac to become private companies again instead of liquidating them.
More neg. news. This take time to reset. Sorry Blue.
Obama Endorsement Builds Momentum for Housing-Finance Overhaul
By Cheyenne Hopkins & Clea Benson - Aug 9, 2013 12:01 AM ET Facebook Share Tweet LinkedIn Google +1 COMMENTS
Print QUEUE
President Barack Obama broke almost five years of silence on post-crisis plans for housing finance by endorsing an approach that would scale back the government’s role to covering mortgage losses only during a catastrophe.
By biding his time, Obama allowed a bipartisan consensus to form around the idea. Republicans and Democrats in the Senate, housing advocacy groups and industry participants including bankers and Realtors have embraced that model, a middle ground in the debate over just how much of the risk of a housing downturn should be borne by taxpayers.
Obama lent his support to a Senate bill with a reduced government role in backing mortgages during a speech this week in Phoenix. The question now is whether the coalition will be strong enough to push forward with an overhaul this year or next, or whether it will end up mired in partisan stalemate.
“I think there is greater momentum towards reform than there has been in quite a while,” Michael Barr, a former Treasury Department official who led the Obama administration’s efforts to rewrite financial rules, said in a interview. At the same time, he said, “It’s likely to take a while to continue to build consensus.”
How fast Congress acts likely depends on the Republican-controlled House of Representatives, which must vote to approve any legislation. Republicans on the Financial Services Committee are moving forward with their own plan, which would nearly eliminate the government role in mortgages.
The House measure is unlikely to become law because it doesn’t have any Democratic support, is not backed by some Republicans, and housing industry representatives are lobbying heavily against it. Still, House Republicans could decide to hold out for their position, blocking the Senate effort.
Senate ‘Ready’
“This is not about the Senate,” said Julia Gordon, director for housing finance and policy at the Center for American Progress, an advocacy group with ties to the Democratic Party. “The Senate is ready to move on this.”
Lawmakers from both ends of the political spectrum say the current situation is untenable: Two out of three new home loans are now backed by Fannie Mae and Freddie Mac (FMCC), the two government-sponsored enterprises, or GSEs, which puts taxpayers on the hook for additional losses.
Fannie Mae and Freddie Mac were seized by regulators in 2008 as defaults on risky loans drove them toward insolvency, and taxpayers have spent $187.5 billion to keep them afloat. Republicans and Democrats alike are calling for the companies to be liquidated and replaced with a system based more on private capital.
Republican Bob Corker of Tennessee and Democrat Mark Warner of Virginia, the authors of a housing bill that has support from both parties, say they think an overhaul could get through both the Senate and House this year.
Time ‘Right’
“I know there’s a real desire to get GSE reform done this fall and I think people understand that the time is right,” Corker said in an interview.
Others are less optimistic.
“I think you have a 40 percent chance you can get to the finish line by the midterm elections, 60 percent chance that you can get done while Obama is president,” said Jaret Seiberg, a senior policy analyst at Guggenheim Securities LLC’s Washington Research Group. “That still means you have a really good chance that nothing happens. The politics of this are insanely tricky.”
The Corker-Warner bill, sponsored by five Democrats and five Republicans, would replace Fannie Mae (FNMA) and Freddie Mac with a federal reinsurer that would step in only after private capital had taken least 10 percent of the first losses on mortgage securities. The government would step in with more aid during a financial catastrophe. The measure was written with technical input from the Obama administration.
Senate Bills
Banking Committee chairman Tim Johnson, a South Dakota Democrat and Mike Crapo of Idaho, the panel’s senior Republican, are spending August working on a bill of their own, which is likely to incorporate an approach similar to that of the Corker-Warner legislation. As senior members of the committee, Johnson and Crapo’s housing bill will take precedence over the Corker-Warner measure.
“In the Senate, both parties agree that the status quo is unsustainable, and bipartisan consensus is starting to emerge,” Johnson said in an e-mailed statement.
The bill is “our next high priority to move and I hope we’ll be moving it right after the break in August,” Crapo said in an interview.
Warner and Corker say they think the Senate and the House will be able to work out their differences.
“The last thing that many in the majority in the House want is maintenance of the status quo,” Warner said in an interview. “If we miss this window you could be stuck with Fannie and Freddie in conservatorship as far as the eye can see.”
The author of the House bill, Financial Services Committee Chairman Jeb Hensarling of Texas, said he’d be open to compromise in a conference committee if both chambers pass their housing bills.
‘Not Naive’
“I’m not naive about the fact that we have a Democrat in White House and I’m not naive about the fact that the Senate is controlled by Democrats,” Hensarling said in an interview. “If something is going to get passed into law, which I would like it to be at some point in the process, by definition it will have to be a bipartisan product.”
Hensarling’s bill would liquidate Fannie Mae and Freddie Mac and limit government support for mortgages to the Federal Housing Administration, which insures home loans for buyers who don’t have large down payments.
The measure passed out of the Financial Services Committee in July with two Republicans voting against it and without Democratic support. Hensarling said he is now focused on garnering enough support from Republicans outside of the committee to try to bring it to a full vote of the House. He declined to speculate on when that could happen.
Window Closing
As the housing market turns around, the window could be closing for lawmakers to act before the current system becomes entrenched.
Fannie Mae and Freddie Mac, which have each been profitable for more than a year, this week announced they’d send a combined $14.6 billion to Treasury, bringing their total payments to taxpayers to $146 billion since 2009. The government takes all of their quarterly profits, which count as a dividend and not as a repayment of the bailout money.
Shareholders in the two companies, long thought to have been wiped out during the financial crisis, are starting to object to that arrangement now that it’s conceivable the government could end up with a net profit on the bailout.
Investors including hedge fund Perry Capital LLC and mutual fund Fairholme Funds Inc. have sued the U.S. in the hopes that shareholders could recoup some profits. They’ve also been lobbying Congress to allow Fannie Mae and Freddie Mac to become private companies again instead of liquidating them.
Some lawmakers say that makes them more determined to act.
“Taking the path of least resistance and allowing the GSEs to again entrench themselves deeper and deeper into our system of housing finance would be irresponsible and foolish,” Corker said in a statement. “It’s time to seize on the growing momentum to move beyond the broken Fannie and Freddie model.”
Guess I missed that memo, WH press release, speech, or off hand remark. Not true at all dude. If he could- I believe he would set them up backup tomorrow. They are part of his base: hard stop.
Perhaps - my guess not. There was a major policy shift announced Monday like it or not. Not to worry though. You cann't reinvent an ocean. This will take time to play out.
Hey Obiteridctum. Just to mention that the actions of FHFA are considered within this group that is run mostly by the Treasry folks. Post 2008, it is much more of collective rule approach in DC.
Re the actions this week. Believe that Monday's action was done to kill the run and to try to get some positive print. Many DC guys are trying to figure how to set up a new system. That is the rub- it will never match the FNF model (also the House is very dysfunctional which is an impediment but not a show stopper) so by default in 2014 we should begin to see some policy shifts.
This still needs to be reset after the President's policy shift. (He did leave a huge amount of wiggle room.) This will drift down to near the dollar mark. Then it will time to load more. Note that there is no more talk of Jack Reed's bill. A negative tell. It is my guess that someone in the Admin really hates FnF likely becaused he or she wasnt hired by them during their ultra-power years.
More to the point- these stocks will run again but the board was reset this week and it will take time to sort out.
Buck, man. Where have you been during the last few decades?
These dudes are the poster guys who screwed this whole thing up.
Obiter -- check out what FSOC is. Yes,I'm going back to an earlier point.
All three of these dudes taked in 10s of millions dollars from fannie- what payroll are talking about. And they are radio-active too.
The Prez left his options open but that is all. Let's see how this plays out.
We got hosed on Monday nite.
How painful at times. Still this stock will have a big run in the future.