the price is the price is the price
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Obama Forces GOP to Say No to Free Jr College and No to Eliminating Fannie and Freddie
What would happen if a national law said that everyone with a 2.5 GPA or higher gets free Jr College Ed? Well, no jr college prof's would even give C grades, and everyone would enroll for the free ride. JCs don't even give bad grades now because they know how hard it is for working people to pay for and go to school. The perverse incentives. Do you want a nurse or car mechanic who should have failed school but was given good grades in order to prop up a failing JC system? BO knows it never gets passed, but it looks great for him and his party to say, hey Dems wanted this great program that Repubs stymied. Just another game to grab votes.
Same with Fannie and Freddie. Forces GOP to admit they like Fannie and Freddie, Big Banks and TBTF. In the mean time he gets to pilfer away all FnF capital to pretend like he is cutting the deficit while propping up housing and affordable housing goals. Now that all Big Bank fines have been paid, Big Banks and Repubs like Fannie and Freddie again. If big banks didn't like Fannie and Freddie, they wouldn't be selling mortgages to the companies. It is a perfect model for them. They earn an immediate underwriting fee with no credit risk and retain customer deposits, ccards, car loans, etc while they offload 30 year fixed rate mortgages that they don't want on their books and regulators won't let them keep on the books. They actually can't profitably do PLS anymore because of Dodd Frank risk retention rules and the capital required!
BO is playing games. Just like with immigration. Making promises to Dreamers and trumpeting how HE is carrying on the American Dream of our Forefathers while Republicans seek to maintain caste ceilings.
This president uses the pronoun "I" more than anyone in the history of the world. Everything is I did this, I did that, I dropped oil prices, I passed free healthcare, what a joke.
Expect capital retention and full privatization in some form. Repubs will initiate a proposal, and Dems will layer in affordable housing goals. Taxpayers will make $400 billion., and everyone wins.
Bernanke Speaking Somewhere Saying Mortgage Market Has Not Normalized?
Anybody know where he is or any links to this? I got a blast message but no details. Thanks.
I consider net positive and am for sure that he is not saying that the answer to this problem is GSE Kill Bill.
Goldman Calls for Breakup of JP Morgan and Tide Shifts in Court of Public Opinion
Eenie meenie miney moe, who is the culprit? Obviously, we know that the financial media has become a series of school girl gossip columns. However, seeing the GS analyst report is starting to gel with the amateurish columnists. I expect a ton of media all over the breakup idea, and Liz Warren as the poster girl along with Sheila Bair, etc.
Notice absolutely zero Big Bank analysts are writing reports calling for the elimination of Fannie and Freddie. Why? Because they are both smart and because they are correct that they should not go anywhere. However, for legal reasons, they cannot write reports blaming themselves for the crisis and calling for a recap.
In the court of public opinion, very positive.
"Dear Diary, Jackpot" by Glen Quagmire
Fannie and Freddie just made another $70 million today. Cash Money Millionaires$$$
Is this Turkey Totally Brain Dead
What the hell is Obama doing giving a lecture tour on how to blame the victim? Maybe he should go on the comedy tour with Bill Cosby?
Program trade says if stock down 30% in 2014 but half of that was in December due to tax loss selling, that stock will re-take all December losses during first week of trading in 2015 and close in 2.40's today.
Fundamental Investors Loving Daytraders Right Now
Daytraders selling a phantom 2.50 resistance, and the Berkshire Hathaway's of the world loving every minute of it...until it breaks out, and they have to buy at $5+++++
Trading at 0.25x Earnings!
Funny to watch amateurs squeal when the stock drops a dime to trading at 0.249x earnings!
Time for Criminal Charges for Mortgage Bankers - David Stevens and MBA = Bernie Madoff and Allen Stanford
Take notice that David Stevens and the MBA have aggressively campaigned against Fannie and Freddie. That is because mortgage bankers have paid over $100 billion in fines for selling fraudulent mortgages to Fannie and Freddie. If you are going to Washington to meet with senators or reps, make sure to hammer this point in. It is time for criminal charges against mortgage banking execs that have committed bigger fraud than Allen Stanford or Bernie Madoff. If you are on twitter or can, write letters to get the word out. It is not okay to blame the victim! Be a scorpion. If the MBA wants to go after GSE shareholders, we can sting back with a potent venom.
8 billion common shares issued to treasury upon exercise of warrants
Ackman's New $50 Per Common Share Valuation Announced on CNBC
400 billion / 8 billion warrants
Did I do that after hours?
"What are you 12th Man on the Deal Team, Last to Know" Gordon Gekko
This board so uninformed that you all only read yahoo finance articles and don't know why the stock started popping after hours before they shut it down? Man you guys and gals are going to need to wear diapers tomorrow morning when it starts quoting pre market.
Corker on Fox for 15 minutes yesterday on his 2015 goals
No mention of housing finance!!! DEAD and rotting corpse. Pour out a drink for Corker Warner.
Jack Lew Trying to Figure Out How to Retain Capital - Biggest News in 6 months.
http://www.insidemortgagefinance.com/issues/imfpubs_igse/15_1/news/Treasury-Called-on-to-Rebuild-GSEs-Net-Worth-Retain-Profits-1000030291-1.html
Today you learn how to trade end of year tax loss selling. I feel sorry for people who sold.
Don't Sauce Your Shorts Over YE Tax Selling
Another day passes and another $70 million in net income is made by Fannie and Freddie.
Sit back and watch As the World Turns and the Bold and the Beautiful. Big rally coming.
I believe that the banks were really lobbying so that the could bury the body (ie Fannie/Freddie) before they had to pay the big settlements.
Similar to an armed robber that kills the victim once the victim has seen their face. Might as well kill them because they are going to jail for life anyways.
Unfortunately, the body was too big to bury and the the ground too icey to dig deep enough. Fannie and Freddie had to survive to save the financial system, and then they won BILLIONS in fraud suits against the banks.
Corker/Warner/Crapo/Johnson/Hensarling bills were designed to bury the body while resurecting the same institution with a new name.
The game is up. Fannie and Freddie win.
If your rent and healthcare costs go up 5 to 10% in 2015 while your wage is up 1 to 2%, you are drowning, especially if 25% of your earnings go to pay a school loan. If you're a 20 something without a trust fund you are fugged.
Who cares if gas prices fall a little? Food prices up big. No inflation for Joe six pack? Yea right. They need to increase housing supply to increase jobs and decrease rents. Getting rid of Fannie is counter productive for everyone except the elites.
Populist Theme for 2015 - Wage and Rent Slavery
Beware the masses
http://www.bloomberg.com/news/2014-12-30/housing-costs-for-renters-rose-by-20-6-billion-this-year.html
http://en.wikipedia.org/wiki/Wage_slavery
Jan 20 State of The Union - Look for a Change in Message on Housing
Bet you big that O will not again say, "We're gonna turn the page on Fannie Mae and Freddie Mac". If he says anything on housing it will be something more like, we are going to help fulfill the American dream, that if you work hard and play by the rules that you will be able to afford to have a house to call your own, yadayada.
The old Geithner, Donovan, Corker, Warner refrain is dead, doesn't have a heartbeat in Washington anymore. If not for the court decision, the common would be at 10 right now; I'm quite sure.
If you are US Treasury and Have Unlimited Ability to Print Money
Why the need to steal the private capital of Fannie and Freddie and take for yourself? Congress will always extend the debt ceiling and allow you to borrow and spend without end. No need to steal anymore. Give the game up. You have lost this one, find another angle, like increasing taxes on the wealthy.
The No News Story That is the Big Story.
If you remember, the Obama admin made a big deal about how Jack Lew was going to meet with Fed, Dimon, Blankfein, Moynihan, Stumpf, et al and discuss creating a benchmark private MBS. They'd create this new mbs security, and the fed could help make the market for it if their were no buyers (since they are able to still replace mbs runoff). Those meetings went very badly with no path forward. That is why there has been no token "private market" news drops and also why there has been the new relaxation, ie, Mel Watt, CSP owned by Fannie and Freddie, 3% down payments, HUD trust fund contributions. Really the only next step is to allow Fannie and Freddie to retain and build capital. The Greenspan method is to hold more capital in order to stave off a next crisis. That is the solution coming out of Basel; now the biggest banks are bigger and more systemically important, but they hold 3x as much capital as they did in 2007. That is really the only solution for Fannie and Freddie, with some minor business model and regulatory tweaks.
Path Forward and Recap in The Works
The biggest problem for the PMI industry is very open and has been clear since 2006. There is little to no capital. The new FHFA regulations are attempting to make PMI companies increase capital standards, but it is really just making them pull back and get out of the business. RDN tried to sell itself, but there were no buyers. The new capital standards basically cut their earnings in half. Given that fact, no private equity firms were interested because they like to buy value that they can lever up, increase EPS, and sell in 3 to 5 years with compound annual 20%+ returns. That's impossible when a company is under Operation Stranglehold by regulators who say, okay, now you have to double your capital, and maybe more, depends on how we feel. This fact also keeps venture firms from creating greenfield companies; too much capital for too little return and too much regulatory and market uncertainty.
The path forward will never be more private MBS insurance. It may be MBS that have no Fannie / Freddie guaranty, but of course, we all know that that requires much higher interest rates which cascades a whole nother domino show.
RDN Auctioned Mortgage Guarantee Business and Nobody Wanted It!
Had to sell asset guarantee business to raise cash just to support what is left of the company. KKR, Blackstone, Flowers, et. al didn't want it. Shitty business. Too capital intensive. Too many regulations and threats from the Treasury to confiscate all earnings in order to pay the US deficit.
Best news in a month!
See where the private markets are taking us fellas!
Full circle back to FNM and FMC - that is with NYSE tickers.
RDN's earnings are going to fall 50% in 2015 because they are required to hold twice as much capital to do exactly what they have been doing. There's just no profit in the private mortgage insurance business anymore.
That's why this 3% down on a mortgage is complete BS. That requires a company like RDN to insure the 17% between 3% and 20%. Nobody is doing it.
Mel Watt just did that as a gesture, it is meaningless without companies like RDN. The bad thing it does is that it gives Hensarling and Corker ammo to say, Hey look, they are doing it all over again and putting the taxpayer on the hook.
It's all smoke and mirrors. The only reality is the Fannie and Freddie are netting $70 million a day in profits. It takes RDN an entire quarter to make that much money, haha.
FHFA is now allocating to the Housing Trust Fund
Next step in the coup is stopping the sweep!
Big Day indeed.
http://www.fhfa.gov/Media/PublicAffairs/Documents/FNM_HTFCMF12112014.pdf