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I think JPM and GS were brought on board by MC to strategize on the best way to release the GSES. The current administration may not have had time to figure out exactly were they are headed but if they are going to follow the spirit of the law in HERA they should focus on release. I'm sure JPM and GS most likely already advised MC on strategies and Sandra Thompson probably knows about them as well.
It will be interesting to see which way the current administration goes and if they nominate a new FHFA Director.
Nats 1, is there anyway to see which contracts each federal agency enters into each year or renews or does the public have access to such information?
Looks like Max and Trea could be headed to another World Series!
Did Bruce Berkowitz get out of his positions in the gses some time ago or does anyone know?
Does Tim Paglia disclose what he's holding?
https://finance.yahoo.com/news/freddie-mac-announces-pricing-381-191500757.html
What's this green stuff mean?
https://finance.yahoo.com/quotes/fmcc,fnma,fmckj,fmcki,fmccm,fmcck,fmcct,fmcci,fmckk,fmccg,fmcch,fmccl,fmccn,fmcco,fmccp,fmccj,fregp,fmckp,fmccs,fmcko,fmckm,fmckn,fmckl,fnmap,fnmao,fnmfo,fnmam,fnmag,fnman,fnmal,fnmak,fnmah,fnmai,fnmaj,fnmas,fnmat,fnmfm,fnmfn/view/v1
Wow! Great find, KT! It will be interesting to see what it looks like when they post 12/31/21 positions sometime in February 2022!
I know I would appreciate it if you did.
They may not be done liquidating their Commons position and they may have internally already decided to go further down commons and up jps.
I guess we don't know what exactly BA, Pags, and BB have done, I think those 4 are or were the largest institutional holders in the gses'.
It also helps explain some or perhaps most of the intra day volatility of jps and the rapid decline of common...
Interesting take on the significance of being the 2/3 owner of fmckj, thanks!
Freddie Mac Releases Quarterly Forecast
MCLEAN, Va., Oct. 15, 2021 (GLOBE NEWSWIRE) -- Freddie Mac (OTCQB: FMCC) today predicted the continued strength of the single-family housing market even as mortgage rates are expected to modestly increase and home prices rise. A new Quarterly Forecast released by the company’s Chief Economist estimates continued levels of homebuyer demand and a growth in purchase originations in 2022.
“Despite some obvious headwinds, the housing market remains strong as the economy grows,” said Sam Khater, Freddie Mac’s Chief Economist. “Even as mortgage rates are expected to increase and home prices continue to rise, homebuyer demand remains steady as inventory issues have slightly improved.”
Khater continued, “Therefore, in 2022, we expect strong house price growth to lift home purchase mortgage originations by more than $500 billion from 2020.”
Specific findings include:
The average 30-year fixed-rate mortgage (FRM) is expected to be 3.0 percent in 2021 and 3.5 percent in 2022. In 2020, the 30-year FRM averaged 3.1 percent.
House price growth is expected to be 16.9 percent in 2021, slowing to 7.0 percent in 2022. Growth was 11.3 percent in 2020.
Home sales are expected to reach 6.8 million in 2021, remaining flat in 2022. Sales were 6.5 million in 2020.
Purchase originations are expected to increase to $1.9 trillion in 2021 and $2.1 trillion in 2022. This is up from 2020 when purchase originations came in at $1.6 trillion.
Refinance originations are expected to soften, declining from $2.6 trillion in 2021 to $995 billion in 2022. This is down from $2.9 trillion in 2020.
Overall, annual mortgage origination levels are expected to be $4.5 trillion in 2021 and $3.1 trillion 2022. These levels were $4.4 trillion in 2020.
Freddie Mac makes home possible for millions of families and individuals by providing mortgage capital to lenders. Since our creation by Congress in 1970, we’ve made housing more accessible and affordable for homebuyers and renters in communities nationwide. We are building a better housing finance system for homebuyers, renters, lenders, investors, and taxpayers. Learn more at FreddieMac.com, Twitter @FreddieMac, and Freddie Mac’s blog FreddieMac.com/blog.
Gasbag is just another talking head that doesn't have the time or resources to investigate the 14+ year conservatorship and get the real story. Apparently the SCOTUS has no clue either!
Vague standards in law like "substantially identical" are the seeds of legal actions in courts.
I saw him yesterday and he has apparently taken too many direct blows in the ring! He's more like their 'scoop guy' and is valued by his contacts inside gubmint, so he probably doesn't want to disparage Uncle Suggy as much as a business reporter with a critical eye should....
Pags loves the fulcrum security and he's ready to be the guy that shoves the common under the bus !
You know his long term investors are giving him a hard time about this 14th year of 'conservatorship'....
https://www.investopedia.com/terms/s/substantiallyidenticalsecurity.asp
https://www.morningstar.com/articles/1045354/wash-sale-challenge-what-is-substantially-identical
"In the case of substantially identical, the most relevant guidance appears in Publication 550, which states, “In determining whether stock or securities are substantially identical, you must consider all the facts and circumstances in your particular case.” The Publication clarifies that “ordinarily, stocks or securities of one corporation are not considered substantially identical to stocks or securities of another corporation.” It also adds that “bonds or preferred stock of a corporation are not ordinarily considered substantially identical to the common stock of the same corporation.”
https://www.forbes.com/sites/baldwin/2012/06/05/wash-sale-trap-what-is-substantially-identical/?sh=6feaba6572d7
https://www.schwab.com/resource-center/insights/content/a-primer-on-wash-sales
Interesting, thanks again Guido!
Nice find, Guido! Wasn't cap growth the biggest institutional holder? As of 09/30/21, they have about 125 million shares of fnma and fmcc evenly split, any idea what that total was as of 06/30/21?
That's the thing about investing in stocks, it's hard to forecast the swings! Remember, you can always come here and let us know what we all know about just how messed up our federal government is...
Who would have thought that a 'conservatorship' would be on its 14th year, despite making billions in profits, only in Amerika, trunk, only in Amerika !
Is that actually green on the screen?
Probably could have added the inability of the business news press to care whether or not two large private corporations have been through a defacto Nationalization. Does gasbag even know words that are more than 4 syllables?
Looks like volume is picking up again...
Some major problems with the status quo are:
1. Government rarely changes and/or acts unless confronted with an emergency or court order.
2. Unsympathetic to our cause to rectify the biggest Nationalization in US history, after all we are simply viewed as opportunistic hedge fund vultures, picking the scrapes after our equally dispised mortgage bankster friends brought the world economy to its needs in 08/09, wiping out millions of Americans life savings.
3. Uncle Sugar enjoys having 100% control over the gses' WITH ZERO LIABILITY ON THEIR FEDERAL BALANCE SHEET for subsidizing American homeowners and offering them something the rest of the world doesn't have, A 30 YR FRM PREPAYABLE AT ANY TIME WITH NO PENALTIES!
4. Legislators who don't have a clue.
5. What American has ever told you, "I'm passionate about mortgage banking!". 99% of Americans probably prefer nationalization so long as their 30 PREPAYABLE frm remains cheap and their corporate profits end up in the federal fisc.
6. Federal Courts bend over backwards for Uncle Suggy, thinking the King can do no wrong!
I'm sure you can add quite a few to that list!
This could take some time...
I disagree, unless the R's get a trifecta (House, Senate, and POTUS) AND they want to rewrite the rules of the mortgage market, the Secondary Mortgage Market in place since 1968 will continue. Why? Because it subsidies the American homeowners by providing the lowest cost mortgage rates available, doesn't cost the government a dime, and keeps trillions off the federal government balance sheet.
Historically, the American real estate market has like any market is subject to booms and busts. Look at what happened in March 2020, one whiff of trouble and the primary mortgage market heads for the hills!
@ 70 centavos, 'Mr. Market' values the Fannie Mae existing commons outstanding at $840M. I think that's pretty low, but it's always possible that the shorts try to take it down further or there is some end of year tax loss harvesting. I'm adding small amounts as free cash flow comes in from my other investment vehicles (did you know that some investments actually pay their investors !)
GLTU, I think in the end the government will realize running two private corporations focused solely on catering to the Primary Mortgage Market is not really what it should be doing, we'll see.
I know you're not going to sell, leading to what? That is the question!
Do you ever think that the federal government will get out of the mortgage banking business?
The current outstanding litigation, with the government refusing to take ANY responsibility for nationalizing two of the worlds most profitable corporations could take awhile and I don't see any recap or exercise of the warrants for some time. Meanwhile, after having the 'conservator' give away all of our profits FOR NOTHING, it will allow for organic capital retention.
“I think the ‘forbearance cliff’ will be minimal,” said David Stevens, former CEO of the Mortgage Bankers Association and former FHA commissioner in the Obama administration.
“Unlike the Great Recession where home prices dropped approximately 20% from peak to trough, this recession saw home values rise by roughly the same amount. So while we should see some foreclosures, the likelihood is that there will be far fewer from a percentage basis due to the ability to sell a home versus default, or stay in the home due to far better workout options and higher re-employment.”
https://www.cnbc.com/2021/10/14/foreclosures-surge-67percent-as-covid-mortgage-bailouts-expire.html
"Because owning a home is the primary way Americans build wealth, the divide is a significant reason why Black Americans’ average net worth is one-tenth that of white Americans' — and the lack of intergenerational wealth continues the cycle."
Are they saying American homeownership is important? I THINK SO! Could the gses' as the largest purchasers of home loans in America somehow help? You betcha !
No bueno for the 'fulcrum security', it seemed like the best way to play the 'conservatorship' according to those in the know !
A little MC Tweet for you...
Interesting article from @MorganRicks1 & quite similar to my approach to reading of GSE charters - Federal Corporate Law and the Business of Banking | https://t.co/3YAP6Eme6J
— Mark Calabria (@MarkCalabria) October 13, 2021
https://finance.yahoo.com/news/fannie-mae-announces-winner-latest-140000473.html
What's up with the 18% intraday volatility with the 'fulcrum security'?
https://finance.yahoo.com/quotes/fmcc,fnma,fmckj,fmcki,fmccm,fmcck,fmcct,fmcci,fmckk,fmccg,fmcch,fmccl,fmccn,fmcco,fmccp,fmccj,fregp,fmckp,fmccs,fmcko,fmckm,fmckn,fmckl,fnmap,fnmao,fnmfo,fnmam,fnmag,fnman,fnmal,fnmak,fnmah,fnmai,fnmaj,fnmas,fnmat,fnmfm,fnmfn/view/v1
No bueno, amigo!
Let's see I'm marking my NEVERLAND calendar for the instant recap and dilution solution date, when is that happening again? !
The problem is in most parts of the US the locals who live nearby HATE TO SEE ADJACENT LOTS PUT TO THEIR MOST ECONOMIC AND BEST USE and can vehmenately oppose changes in their neighborhood with the local zoning approval board. California via a state level law has largely overruled this impediment to increasing housing supply.
Case in point, when I worked for Fannie Mae in the 1990's I worked in a sleek new office building that ONLY GOT NEIGHBORHOOD ZONING APPROVAL WHEN THE DEVELOPER AGREED TO PAY FOR LIFETIME GYM MEMBERSHIPS FOR THE LOCALS IN THE NEIGHBORHOOD! I'm not making this stuff up!
If you asked most people about the idea of the government taking $308B from the mortgage bankers/hedge fund guys and transferring it into the government treasury for nothing in return, the vast majority would likely not have a problem with it. Sadly including our SCOTUS...
The latest thinking seems to be upzoning, which California (the Peoples Republic of California? HeeHee!) just allowed owners of single family homes to triple the amount of housing units on the same lot, also upzoning can allow for builders to build up and maximize individual lots of land with more Multifamily housing units and more private market incentives to do so, namely profits.
The $300B in fresh money (it's 'free' right?) that is dwindling down fast in the proposed 'infrastructure/social equality' bill will create more government run housing at HUD I assume but I'm not sure how it will increase the 5.6 million units of Supply defiecency in Americas housing market.
I wouldn't be surprised if some of it was the developer dragging his feet to possibly get a higher sales price or other monetary gain, but still a government solution to affordable housing will be plagued with spiraling costs...
You want the instant recap and you want it NOW! After having the brilliant James Lockhart or Edward Demarco GIVE AWAY $308B OF CORPORATE ASSETS TO THE UST OVER 7 YEARS IT WILL TAKE SOME TIME OF EARNINGS RETENTION FOR THE GOVERNMENT TO MONETIZE IT'S 'INVESTMENT' IN THE GSES.
Have you heard about the litigation slowly meandering throughout the federal judicial system?
Who says that government isn't an efficient allocator of society's limited resources? https://nypost.com/2021/10/09/affordable-nyc-housing-project-sits-empty-for-over-2-years/amp/
https://www.businessinsider.com/housing-market-shortage-democrats-cut-funds-biden-reconciliation-house-prices-2021-10?amp
Where will they get a new source of funds for American affordable housing?
"Housing is health care, it is stability for children, it is climate justice, and it is racial justice," the Democrats added. "This is an investment that simply cannot wait and must be included at robust levels in the budget reconciliation package."
Decades of underbuilding have left the US with a 6.8-million-home deficit, and builders aren't rushing to fill the hole. The shortage has helped prices soar at a record pace and threatens to keep housing out of reach for an entire generation.
An increase in home supply would come at a critical time for prospective buyers. Millennials are in their peak homebuying years and are expected to bring a once-in-a-lifetime wave of demand. But the generation's finances were already pummeled by the Great
Recession
, and the pandemic-era housing frenzy has left them even less equipped to buy their first homes.
Well you could set up a Testamentary Trust that kicks in when you pass and set it up with distribution of the assets at certain milestones, say 25% distributions at 5 year intervals. You would need a Trustee or someone you trust to manage it. Just Google estate planning attorneys near your biggest metropolitan area...
https://www.investopedia.com/terms/t/testamentarytrust.asp
https://www.kiplinger.com/retirement/inheritance/603437/5-of-the-worst-assets-to-inherit?amp
The localities will have to pay for all the costs of educating triple the amount of families that were formally single family and of course bankroll the endless social programs at up to 3x per lot. I think CA has a law that prohibits increases in real estate taxation for existing owners and someone is going to have to pay for the added strain on local government budgets!
Can Sacramento raise taxes any higher? I'm sure they will!
https://www.foxbusiness.com/technology/elon-musk-texas-hq-move-lorena-gonzalez