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Here's a good 60 minute primer on Appeals in the federal court system. Looks like there is an approximately 6 month window between the filing of Briefs and Oral Arguments:
Appellate courts don't decide questions of fact, only questions of law and procedure.
"Appellate courts review the procedures and the decisions in the trial court to make sure that the proceedings were fair and that the proper law was applied correctly."
https://www.uscourts.gov/about-federal-courts/court-role-and-structure/about-us-courts-appeals#:~:text=Appellate%20courts%20review%20the%20procedures,proper%20law%20was%20applied%20correctly.
How'd Bill do last year? He beat the S&P 500, again!
https://www.institutionalinvestor.com/article/2co2nlo12j1nk5gmbm3uo/portfolio/hedge-fund-manager-bill-ackman-earned-around-600-million-in-2023
In light of today’s news, I thought I would try to take a step back and provide perspective on what this is really all about.
— Bill Ackman (@BillAckman) January 3, 2024
I first became concerned about @Harvard when 34 Harvard student organizations, early on the morning of October 8th before Israel had taken any military…
The FHFA and UST have unclean hands here and refuse to accept culpability for their actions. The Judiciary seems like a branch of government for the Shareholders to get redress and obtain relief from the "salt the earth with the Shareholders Carcasses" actions of the federal government.
Could you imagine if he was the head of OMB! HeeeeHeeee!
Todays NYT: "Just 16 percent of homes listed in 2023 were affordable for the typical American household.
The year ended disappointingly for many American home buyers — fewer than 16 percent of homes for sale in 2023 were affordable to local median earners, according to a study by Redfin. That’s the lowest rate since at least 2013, the year Redfin began tracking prices, when 50 percent of homes were affordable to local median earners. In 2019, before the pandemic, 40 percent of listed homes were affordable. In 2022, only 21 percent were.
For the study, researchers defined “affordability” as housing that costs no more than 30 percent of income. They assumed a relatively low down payment of 5 percent, a 30-year-fixed-rate mortgage with the interest rate current to the month the home entered the market, plus homeowners insurance and private mortgage insurance. Prices and incomes in the 97 most populous U.S. metro areas were examined for the study."
HeeeeHeeee! Sentimental Hogwash!....
Btw, Americans need Housing!
Todays WSJ: "But institutional investors want a bigger slice of the action. They own 55% of all U.S. apartment units but see family homes as a more attractive bet. Rent growth is stronger for single-family homes than for apartments, and tenants tend to stick around for longer. On average, renters in single-family homes stay in their properties over four years, compared with two to three for apartment dwellers.
But the strategy that powerful investors such as Blackstone used to amass tens of thousands of family homes since the 2008 financial crisis is running out of steam. Picking off individual houses dotted around the country is time consuming, expensive and inefficient. "The scattered sites model has run its course. It worked when lots of houses were in foreclosure but it's not the future of the industry," says Brad Case, chief economist for Middleburg Communities.
It is harder for Wall Street players to get their hands on new houses in bulk these days. When the market is weak, home builders sometimes opt to unload finished houses to institutional investors at a roughly 10% discount if they need to wrap up a development. But this isn't happening now. There is so little housing inventory available to buy that newly constructed homes are being snapped up immediately by regular buyers.
Wall Street's solution is to build new neighborhoods of family homes where everybody rents. The model isn't new: Clustered housing for students and senior citizens has been around for decades. The number of "build to rent" communities is small, with 900 neighborhoods nationwide, each with an average of 135 to 150 homes according to a report by the Urban Institute. But the concept is growing fast. The National Association of Home Builders estimates roughly 10% of new housing construction is destined for build-to-rent.
It is efficient for big investors to pool all of their rental homes in one place rather than have them scattered all over a city. Fixing broken appliances is cheaper when the handyman doesn't have to drive miles across town between properties.
And landlords are discovering new ways to keep a lid on costs when they can design whole neighborhoods from the ground up. A family home built by institutional investors will usually have a wide hallway and stairs to protect the paintwork from knocks when several tenants haul furniture in and out. The homes are sturdily built, with flooring that will last for years.
Investors that can build new housing themselves will find it easier to grow their portfolios profitably in the coming years. New York-listed real-estate investment trust American Homes 4 Rent is constructing over 2,000 new family homes. Invitation Homes opted for partnerships with housebuilders, however these arrangements are more expensive as the builder must get a cut. Both stocks, which specialize in family homes, should continue to outperform struggling apartment REITs like Equity Residential.
Regular house hunters won't be sorry to hear that fewer deep-pocketed investors may be bidding for America's scarce family homes in the future. And any new stock that landlords build is welcome -- depending on whom you ask, America is short anywhere from 2 million to 4 million homes. The only downside might be a lack of charm in these new neighborhoods."
No SM for US Treasury Secretary next year? Also, apparently Wilbur Ross (he gave Lockhart a job when he was replaced by Demarco) is out of the picture.
https://www.cnbc.com/2024/01/04/treasury-secretary-steven-mnuchin-yet-to-help-trump.html
“Mnuchin has not been in the room,” said Stephen Moore, a conservative economist who is advising Trump. “I don’t know if it’s Mnuchin being done, or maybe there was a falling out between the two.”
What did the former POTUS say about the Net Worth Swipe in his letter to Senator Rand Paul?
Sue'em. Takes time and resources. How many years since you initially filed? Past the Pretrial Stage yet?
What does the FHFA and the US Treasury have in common with the Mafia?
They both thrive in Banana Republic's!
Judge Sweeney: "Sounds like the Government made an offer they couldn't refuse.!"
Appellate Judge Brown: "The Government is acting no better than a Banana Republic."
After the 3rd Amendment, the GSES were required to pay their entire Net Income over to the US Treasury each quarter.
Like any business, because the GSES had losses from 2008-2011, they are allowed to carry forward these losses to future years if they eventually recover. Under the Internal Revenue Code, these carry forward losses are eventually reduced to zero as the business uses them in profitable years.
Here, the FHFA (and UST?) in order to take every penny from the corporations, told the GSES to write off the $50B+ in deferred tax assets, under the premise that the GSES would never be profitable within the foreseeable future. Then subsequent to the NWS, the FHFA (and UST?) reversed itself and reversed itself.
When you or one of your businesses owes taxes, to whom do you write the check to? The US Department of Treasury (aka Uncle Suggy .
Does it matter if it was CASH or not paying what would have been CASH due to the US Treasury?
BTW, any intra governmental communications between the US Treasury and the FHFA were EXCLUDED FROM TRIAL AS THE GUBMINT CONTINUES HIDING BEHIND EXECUTIVE PRIVILEGE AND NATIONAL SECURITY exemptions to Discovery. Here, the Truth revealed to the American Citizens would make the Government look bad.
https://www.washingtonpost.com/news/wonk/wp/2013/05/04/this-accounting-tweak-by-fannie-mae-and-freddie-mac-will-mean-60-billion-for-the-u-s-government/
https://www.pwc.com/us/en/services/tax/library/demystifying-deferred-tax-accounting.html
https://www.irs.gov/payments/pay-by-check-or-money-order#:~:text=Make%20your%20check%2C%20money%20order,send%20cash%20through%20the%20mail.
The Implicit Breach of Contract was for the Implicit Good Faith and Fair Dealing Contract between Fannie Mae and Freddie Mac (here, the FHFA in its acting capacity as the Conservator) and their Shareholders.
The SPSA is a different contract between the UST and FHFA in its acting capacity as the Conservator, which the USSCT in Collins said was within the FHFA's power under HERA.
On appeal, do you think the Plaintiff will ask for expanded damages?
I'm sure Janet Yellen and the UST could end this 16th year of Conservatorships, but will they, we will know within the next 9 months, otherwise on to year 17...
Senate Banking Committee hearing:
Senator Haggerty: "Director Thompson, what are your plans for ending the Conservatorships?"
Director Thompson: "We're waiting for Congress to decide the future of the US Housing Finance Market."
"The Government is acting no better than a Banana Republic!" US Appellate Judge Brown
Basically the GSE'S take a quarterly charge or reversal called a Loan Loss Reserve, where the GSE'S estimate their future credit losses from the anticipated future prices of the houses underlying their MBS and mortgage loans. The FHFA pushed hard to have the GSE'S overly inflate those projected Loan Loss Reserves, which are not the ACTUAL losses but ESTIMATED.
What did the GSE'S do starting in the 3Q12 and 4Q12? THEY INCREASED THEIR QUARTERLY INCOME BY REVERSING THE LOAN LOSS RESERVES and transferred the CASH to the United States of America Treasury.
It's outrageous, first they make the GSE'S take huge NONCASH Expenses for the Loan Loss Reserves, GENERATING HUGE LOSSES THAT REQUIRED DRAWS FROM TREASURY, and then viola, they reverse it and PAY CASH TO THE US TREASURY IN RETURN FOR NOTHING!
The GSES should have been building Capital.
Also, the FHFA and UST told the GSES to write down $50B+ in tax deferred assets, this resulted in yet MORE NONCASH Losses and draws from the UST. What did the FHFA do post August 17, 2012? They allowed the GSES to write up the tax deferred assets and guess who got the $50B+ in return for NOTHING?
The 3rd one was the US DOJ timely settling with the TBTF banks that started the Great Financial Crisis with their garbage toxic PLMBS (about $50B).
From the Fannie Mae press release on 2013 Earnings:
Fannie Mae reported annual net income for 2013 of $84.0 billion, which includes the release of
the company’s valuation allowance against its deferred tax assets, and annual pre-tax income for
2013 of $38.6 billion.
• Fannie Mae reported net income of $6.5 billion for the fourth quarter of 2013, the company’s
eighth consecutive quarterly profit, and pre-tax income of $8.3 billion for the fourth quarter of
2013.
• Fannie Mae will pay Treasury $7.2 billion in dividends in March 2014. With the March dividend
payment, Fannie Mae will have paid a total of $121.1 billion in dividends to Treasury in
comparison to $116.1 billion in draw requests since 2008. Dividend payments do not offset prior
Treasury draws.
• Fannie Mae has funded the mortgage market with approximately $4.1 trillion in liquidity since
2009, enabling families to buy, refinance, or rent a home.
• Fannie Mae is supporting the housing recovery by providing access to affordable mortgages and
by helping to build a safer, transparent, and sustainable housing finance system.
• While Fannie Mae expects to be profitable for the foreseeable future, the company does not
expect to repeat its 2013 financial results, as those results were positively affected by the release
of the company’s valuation allowance against its deferred tax assets, a significant increase in
home prices during the year, and the large number of resolutions the company reached relating to
representation and warranty matters and servicing matters.
Bottom line, the Government has unclean hands here and 8 Jurors unanimously agreed.
We'll find out shortly, stay tuned.
From 2013: "Fannie Mae Paid Treasury $82.5 Billion in Dividends in 2013"
https://www.fanniemae.com/media/26656/display
Fannie Mae Reports Comprehensive Income of $84.8 Billion for 2013 and ... https://www.fanniemae.com/media/26656/display
Seems likely to me that one or more of the parties will appeal.
$600m is small potatoes compared to the taking of our entire economic interests in the corporations, so maybe the FHFA realizes this is a good deal for them. Who knows what exactly is going on, but if Sandra talks to Janet and they actually had a plan for exit, they may surprise us (seems a little far fetched to me).
Then there's this Wild Card:
385 days until January 20, 2025....
Do you think the Plaintiff Shareholder Attorneys should appeal, once Judgment is entered?
The $191B advance from the US Treasury was largely the result of non expense accounting charges mandated by the FHFA.
The Plaintiff Shareholder Attorneys in Lamberth's trial did a great job explaining this to the Jurors and the esteemed accounting Expert Witnesses were some of the best I've ever seen.
Read this Amicus Brief from Tim Howard from the 2019 Collins USSCT case to understand WHY THE $187B is a bogus number.
http://www.supremecourt.gov/DocketPDF/19/19-422/154595/20200922104336414_Amicus%20Brief%20of%20Timothy%20Howard%20for%20Filing.pdf
https://www.supremecourt.gov/docket/docketfiles/html/public/19-422.html
"II. A COMBINATION OF TEMPORARY AND
ARTIFICIAL NON-CASH ACCOUNTING
ENTRIES IMPOSED BY FHFA FORCED
THE COMPANIES TO DRAW $187
BILLION IN SENIOR PREFERRED
STOCK FROM TREASURY...........................19
III. THE FEDERAL PARTIES IMPOSED THE
NET WORTH SWEEP IN AUGUST 2012
TO ENSURE THAT INCOME FROM
REVERSALS OF THE COMPANIES’ NON-
CASH ACCOUNTING EXPENSES
WOULD BE TRANSFERRED ENTIRELY
TO TREASURY, PREVENTING THE
COMPANIES FROM REBUILDING THEIR
CAPITAL.........................................................24
CONCLUSION ..........................................................27"
Fantastic! Many real estate finance industry specialists are speaking out as well!
Sounds great, we appreciate you getting out the tweets after over 15 years of defacto Nationalization of our Corporations!
I looked at a retirement community near the Jersey shore in the 1990's for some investors, as I recall the Investors own the land and they run the Park, the residents own the trailers or their homes and lease the lots plus amenities from the investors.
Typically good NOI with a healthy Cap Rate right from the beginning for investors.
https://www.caffreyloans.com/fannie-mae-mobile-home-park/#:~:text=Fannie%20Mae%20(FNMA)%20Mobile%20Home%20Park%20Loans%20offer%20long%20term,associated%20common%20amenities%20and%20infrastructure.
But for the bad faith and unfair dealing of the former FHFA Director, the GSES would have close to $1B in Capital on their books today, more if you count the legal fees and costs associated with defending the bad acts over a decade of Litigation.
Why is the federal government not accountable at all for its bad acts?
Because it's a government by the government for the government at the expense of the American citizens?
It takes 2 to tango, as I recall the FHFA Director has to approve the transfer of funds (or increase in the LP?) from the balance sheets of the GSES to the US Treasury.
Remember this request from the banking industry:
"We urge FHFA to suspend the dividend payments to the U.S. Treasury this month and allow the Enterprises to rebuild their capital buffers to avoid a draw for widely anticipated non-credit related losses at the Enterprises. We know this decision is time sensitive, so we thank you for your consideration of our views and we would welcome an opportunity to speak further."
https://civilrights.org/resource/letter-to-secretary-mnuchin-and-director-watt-regarding-fannie-mae-and-freddie-mac-profits/
Decoupling the GSES from 100% Government control would be better for the Financial Intermediaries than letting them remain in the Conservatorships and subject to the inefficiencies and whims of politicians.
It would also provide a more liquid and vibrant and predictable Secondary Mortgage Market to the benefit of the Real Estate Industry and American Families.
Could go higher if enough investors start to realize that with the government found guilty of bad faith and unfair dealing in a court of law, with unclean hands, and hiding a mountain of incriminating evidence, that the release could be sooner than later.
We'll see what happens.
Warren bought a gas pipeline from Dominion Resources a couple years ago and likely doubled his capital, hosing the Shareholders of the company, but Dominion Resources wants to attract all these data centers and the Amazon's of the world prefer green energy.
Shrewd dude, but he's typically a long term investor and if he's a minority Shareholder, his investment goals align with the other Shareholders.
Don't know, but if I see Warren's private plan land next to mine on the tarmac at Reagan National Airport, I'll let you know !
Does the FHFA, acting in its sole capacity as the Conservator, violate the Implicit Contract between the Shareholders of Fannie Mae and Freddie Mac when it implemented the 4th Amendment and subsequently approves the LP each quarter?
He'd probably love to own Fannie Mae and Freddie Mac in it's entirety, but if the management is capable, he'd own a minority share.
On the other hand, he and Charlie decided pre 1980 that they didn't want to own banks and opted for insurance instead, as it is less highly regulated. He and Charlie discussed it here in May 2023, on or about the mid point of their final Berkshire Hathaway Annual meeting as a team of 2:
Buffet's companies are invested fairly heavily in real estate. He profits from GEICO'S real estate portfolio, Shaw Carpets and flooring, Clayton Manufactured Homes, Sherwin Williams, Berkshire Hathaway Realtors Group, Mortgages via BofA and Wells Fargo.
He's got the cash available for a major stake in the GSE'S but would likely want to make sure that the t's are crossed and the i's dotted on the end of the Conservatorships.
I've personally seen investors do well with trailer parks.
Charlie Munger was one of the biggest holders of Multifamily in So. Cal.
The banks will simply exit loans that don't hit their targeted return requirements, including underwriting less 30 year Fixed Rate Mortgage's for American Families.
Typically less competition equals higher prices (a concept your beloved party consistently fails to appreciate ! )
Worse case scenario: We have another 2008-2011 30% drop in US Housing Prices, with almost all the 30 year Fixed Rate Mortgages underwritten by nonbanks holding razor thin Capital who are unable to buy back Mortgages underwritten in Violation of their Representations and Warranties to the GSES.
Unlike the GSE'S (who are barred from any sort of Lobbying for their own best interests on the Hill pursuant to HERA and the Government's defacto Nationalization), the TBTF banks aren't taking higher Capital Ratio Requirements lying down.
The TBTF banks are doing a full court press Lobbying campaign to soften or eliminate the blow of higher Capital Ratios under Basel III:
"The Proposed Rule
The U.S. agencies’ proposed rule sets capital requirements for mortgage loans using a standardized approach that is empirically unsupported and demonstrably punitive to U.S. mortgage borrowers. For credit risk, the agencies propose to use the same risk segments as Basel but would arbitrarily add 20 percentage points to each risk segment. This means the proposal would increase the risk weight for high loan-to-value (LTV), first-lien mortgages (with LTVs over 80 percent) well beyond the 50-percent risk weight applicable under the current standardized approach.
Banks would also encounter another capital charge for operational risk. This would significantly elevate the total risk weight for mortgages sold to the GSEs, as we outline below.
Moreover, banks would face a substantial stress capital buffer charge for all mortgage exposures, given the large fall in home prices assumed in the stress tests and the inclusion of the stress tests’ operational risk losses on top of the existing standard operational risk charge.
Finally, banks operating in the United States are not allowed to use internally modeled approaches for determining risk-weighted assets, which are permitted in other jurisdictions subject to a floor of 72.5 percent of risk-weighted assets under the standardized approach. So, uniquely for U.S. banks, there would be no escape from punitive standardized charges, regardless of whether these are demonstrably excessive in relation to historical losses."
https://bpi.com/the-basel-proposal-what-it-means-for-mortgage-lending/
Pretty sure he's saying that with the higher Capital Ratios under Basel III, the regulated banks will become even less interested in the Primary Mortgage Market (and keeping 30 year FRM'S on their balance sheets) and will continue ceding Mortgage Market Share to the much less regulated nonbanks, like Rocket and UWM, hedge funds, and other less regulated financial Intermediaries.
This should increase the spread on 30 year Fixed Rate Mortgage's over the 10 year Treasury, thus making the cost of homeownership higher for American Families.
Our brilliant dear leaders will have an epiphany that denationalizing and privatizing the GSES will bring more competition for 30 year FRM's and American Families needing housing will get some relief.