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Rek,
No two cases are exactly similar. That is why plaintiffs, defendants and judges use hundreds of case laws to decide a specific case. When this is done, essentially it is subject to wide and vague interpretations and the original meaning is lost like in any language translation.
Historical rulings should be used to understand the laws, but should never be used as binding to decide the cases. This is where legal system is failing.
Rek,
It is not the job of court to legislate.
All these rulings need to be non-precedential unless validated by the congress.
rek,
If common people or investors do not understand these messed up laws because of overly complex laws, then can common people or investors be held responsible for violating them?
Have not such laws hijacked the constitutional protections for the common people? Is it not the case with fake conservatorship?
Rek,
Judges are not allowed to revisit the laws/constitutional questions if there exists a case law already. So no one for sure knows how these complex case laws can be used to rule.
He is not a nut case in the sense that he is not foolish.
Many are using the system to make as money as possible.
Well Corsi is also correct.
BTW millions is big number even for US Gov including POTUS. POTUS is paid 400K PA.
Rek,
Thanks, That is what I meant.
Do not Common laws have precedence over all other laws including constitution?
Is this not how judges have frustrated all by conveniently picking laws that suits them?
Rek uses lawyerly imaginations to make up the these things.
No one can question the authority of FHFA conservator, not even three branches of US Gov? One can read Gov filings and Perry appeals ruling.
Thanks for your recommendations to go long on FnF stocks.
Your arguments are very compelling.
The proponents of explicit Gov guarantees may one day regret for involving Gov in private business.
Once Gov starts providing explicit Guarantees, then politicians will start making laws on how the private businesses are run and also put limits on executive compensations and bonuses. Politicians may demand clawback when businesses fail with Gov Guarantees.
Many companies including banks have already experienced this.
reccusdo,
"Maybe...you are assuming that they are hiding the documents due to an FHFA related matter."
You have amazing imaginations!
Why would Judges or Gov allow such discovery requests if these are not related to FHFA conservatorship?
"No one can really answer that for sure. Anyone who tries is full of it. "
Shall we put it this way?
Who ever is trying to hide these documents created during previous administration from public are full of it. These are private companies under FHFA coonservatorship. Gov used 100s of billions of taxpayer money to bailout unknown companies and also destroyed 100s of billions of FnF investors money. Public and investor have right to know and surely they can make reasonable guess.
"F and F held 800B of MBS paper - as an investment - as an asset on the balance sheet"
Are these own issued MBS or third party MBS?
If these MBS are own issued MBS then where is the loss?
As long as underlying loans are performing, FnF get the principal and interest payments. Only loan losses affect the balance sheet.
If these are PLMBS then any loss in value may affect the balance sheet.
Even then if the underlying loans are performing, FnF still get the principal and interest payments.
There is no logic or reason to predict on how judges will rule in cases like FnF.
Judges simply go by their political leaning or ideologies when deciding the cases. Judges use congressional made laws or court made laws or simply made up laws to rule in any way they want like in FnF cases. BTW who can challenge the Judges except Gov attorneys? That is why private attorneys address Judges as if Judges are lords and private attorneys show utmost respect even when not agreeing with Judges.
There is famous saying “Show me the man, and I'll show you the crime.”
Same is true in civil cases of FnF shareholders.
Donotunderstand,
It is difficult understand how price decline in it own issued commons, preferred, MBS/bonds of the company affects issuing company balance sheet?
During price declines companies try to buy back their own issued securities if it beneficial to the company.
You need to explain how price decline in it own issued securities will affect balance sheet of the issuing company.
If a company holds securities issued by the other private companies, then it will affect the balance sheet of the company that has bought those securities.
"But what if China wanted to test the IMPLICIT Guarantee with say 100B of paper put to F and F as issuer
Where would F and F find that kind of cash ?
(By selling another 100B of similar paper ? By pledging paper and borrowing from Treasury?)"
Please remember that FnF MBS are not Bank deposits that can be withdrawn prematurely in a run on Bank.
So the question of FnF coming up with $100B cash is not relevant. Once FnF sell MBS, FnF only guarantee principal and interest payments. FnF are not required to buy back.
"if the Chinese wanted to dump $1 Trillion in a day or a week? "
If Chinese were to dump the $1T MBS they would have lost lots of money. But that is not run on MBS. May be that would have depress MBS mkt for some time. If FnF were to buy back those MBS below the market price, FnF would have made tons of money.
BTW Why would Chinese dump MBS when there was no risk of default?
It was made up story by Hank&Co.
"(e.g. one can argue - right or wrong - that not doing so would have caused a run on F and F MBS paper that was at tsunami levels "
Many people including Senior Judges have made this fundamental mistake of comparing FnF to Banks. FnF are not banks, FnF are specialized insurance companies. MBS are not bank deposits. FnF securitize mortgage loans and sells as MBS guaranteeing principal and interest payments.
So why would there be run on FnF MBS?
Under normal circumstances (if rule of law is followed) FnF pps should be much higher (atleast above $10).
Engineered bad news during "Obama rule" kept pps low. With all the better news, it is surprising that PPS still so low.
Predictable ghost appearance when PPS starts going up.
Expect many more ghosts.
"WOW I have never heard such argued before "
Not sure how you are read and how much know about 2008 crisis.
Before conservatorship things were bad. But Hank and Ben could have helped the situation instead of just promoting ideology.
Take a look at chronological events before conservatorship and after conservatorship. Events speak for themselves.
https://www.stlouisfed.org/financial-crisis/full-timeline
Immediately after conservatorship things really start falling apart.
Initially these people assure that everything is ok and make investors to invest more $20B in FnF and suddenly seize $5T companies and put under conservatorship. This created shockwaves in the market, causing the meltdown.
Clark6290,
For a moment, put yourself in the shoes of a FHFA Director.
As a FHFA Director you never want to hold yourself as a cause for another financial meltdown like 2008. BTW most of the lawmakers who are urging to continue NWS, never supported your confirmation.
Hank, Ben and Lokhart were personally responsible for 2008 financial meltdown by putting FnF in conservatorship. FnF were fully liquid with $85B core capital, profits and hundreds of billions in AAA loan assets. FnF were mainly only incurring paper losses. Actual credit losses were very manageable. If Hank and Ben were to honor credit lines then FnF would have never needed any gov bailout and 2008 meltdown would not have happened.
agree with you.
Not the victim senator's income.
It should apply to Corker-Warner-Crappo ant-FnF senate and house team.
rekcusdo,
ACA predating NWS by 2 years does not explain in any way that NWS was not necessary or not used for funding ACA subsidies. One needs to understand the situation and crisises during that time that made Obama administration to resort for oppotunistic NWS.
NWS at that time also served multiple purposes for the Obama administration. NWS pleased anti-FnF ideologues and financial establishment because FnF were about to pay back and return to private shareholders. These people liked NWS because NWS would keep on bankrupting FnF and ultimately wind them down and these people did not care about how NWS money was be used. For the administration it was opportunity to hide the looming failure of ACA by funding surreptitiously ACA subsidies. It was not protecting taxpayer, it was risking taxpayers if one looks at it in any they like. Probably discovery documents should reveal of these factors.
Factors to consider:
1. Change in Balance of power in congress during that period
2. Debt ceiling crisis and no money to spend
3. Growing deficit and growing debt increase political pressure for balanced budget
4. Refusal by congress to appropriate funds for ACA subsidies
5. Failure of ACA to reduce premiums. So unexpected increase in ACA subsidies and no money to pay for it.
6. Need to claim success on ACA program
One needs to match Budget line items to understand how NWS was used to fund ACA subsidies.
Also please watch
Thanks, Good one.
It looks like simple accounting.
Start with actual US total incomes and expenses and then takeout (deduct) congress appropriated corresponding incomes and expenses. Adjust for any excess or less spending on congress appropriated corresponding items.
That leaves non appropriated incomes and expenses items.
Then it easy to match non appropriated expense and income items.
rekcusdo,
Mark Calabria does not like MBS model.
Mark Calabria like traditional equity based model.
He is not against FnF or shareholders.
rekcsusdo,
Thanks, But I expected more from you as a law professional.
"1. You need to add in the additional fact that the current secretary of treasury that was elected by President Trump said that the Fannie Mae and Freddie Mac funds were not being used to find affordable care act. "
Response:
TsySy Mnuchin when directly asked about this by Maria, Mnunchin answers affirmatively without denying it. Mnuchin or DJT administration has in way confirmed this and never denied this. If you referring to some other source please post the URL.
"2. If in the comment that you made above you replace the term "FnF NWS" with the words "income tax", you come to the exact same conclusion... that the net worth sweep is paying for the affordable care act as much as any other incoming funds to the treasury... that the affordable care act is not receiving any special funds from the net worth sweep that other government programs aren't getting... that if the net worth sweep ended today the affordable care act would continue to get funding... and that if President Trump wanted to end the funding to the affordable care act he could do that irrespective of ending the net worth sweep. "
Response:
Only congress has taxing authority. FHFA or any investor/creditor do not have taxing authority. FnF NWS is a confiscation based on inter agency agreement. There exist no laws to tax 100% profit and capital to bankrupt private shareholder companies under conservatorship.
Then where does FnF NWS money go after they are put in general funds?
Obviously congress authorizes all the spending except ACA subsidy.
Are there any spending items other than ACA subsidies that congress does not authorize?
If given below statement of facts, what would be the conclusions?
1. All the confiscated FnF NWS money is put in general funds
2. All spending including ACA subsidies can only come from general funds
3. All spending items are authorized by Congress
4 Only ACA subsidies are not authorized by the congress
Then where does the money come from? or
What is process used to fund ACA subsidy?
Can Administration spend money without congressional appropriation?
Already District Court court has ruled against and is in appeals's court.
Thanks for correction.
Most were expecting that 1Q sweep will not happen.
But administration needed money to pay for ACA subsidy and congress had not appropriated the money for ACA. Looks like DJT administration wanted to give enough time for congress to decided on what to do with ACA subsidy rather than abruptly stop it and disrupt ACA healthcare for people already enrolled. DJT adminsitration informed congress that ACA subsidy payments will be made up to end of May like OB administration.
It is grossly overstretch to think that any one will pay any attention to rhetorics of BC-MW knowing their trading history and the hundreds of millions they have made.
There are many sides to FnF controversies. But since Nov elections things have changed. Anti-FnF critics have lost the power and Pro-FnF have the gained the power. Mel Watts knows very well, the moods of the people in power.
Basically institutional investors are trying to create a plan that is politically acceptable.
The Moelly's plan is very good and needs some changes.
Mel Watt raised serious concerns more than 1 year back about running companies with zero capital. But OB Administration official policy was to bankrupt FnF down to zero capital and fund the ACA subsidy with FnF profits. So basically OB administration prevented Mel Watt from doing his job.
With DJT administration the official policy has changed. DJT is a rule of law president. Mnuchin likes FnF business model and wants to preserve FnF business model with sufficient safeguards to protect taxpayers.
With Ob Administration bankrupting FnF already, DJT administration has been left with baggage of funding future FnF losses and has nothing much to gain from NWS.
As for as remaining $5B from FnF as per original SPSPA, please refer many published articles. The statement itself is very clear.
Tell us how you arrived at these numbers.
There are no reasons to believe that Watt will continue the payments atleast in the case FMCC. But there may be reasons in case of FNMA as FNMA still owes about $5B as per original SPAPA.
It is very very simple.
Private shareholders own the companies and
Gov does not own the companies.
rekcusdo,
Thanks for your efforts.
There is absolutely nothing wrong in questioning generally accepted narratives and theories. This is the only way for public to see the real truth. Most of the MSM makes every effort to suppress such people.
If Einstein were to just accept Newton's theory, we would still be living in 18th century. We have seen these controversies happening time again in the history.
What was the generally promoted media narrative about FnF and how it has changed? If FnF shareholders were to accept the false narratives from MSM and OB admin then truth about FnF would have never seen the light of the day.
It is better to be skeptical about generally accept narrative and theories than just just accept them as final truth. People who question and try to explain with alternative theories and explanations do serve very important role in keeping the liars in check.