Let's go back to the original conversation which started when I observed that a major investment bank was entering the same business as Fannie Mae... buying real estate loans from banks, packaging the loans as MBS. guaranteeing the payment of guarantees on MBS sold and, lastly selling the MBS to fixed income investors. I said this was a new class of competition for the GSEs and would not be helpful to revenue which has been on a steady decline throughout 2015 and so far in 2016. That was the basis for the discussion.
You then launched into some rant about how none of this mattered because it was immaterial to revenue.
First of all, it is NOT positive for either GSE to observe new competition entering the MBS business, especially when the market entry is being based on GSE guarantee fees having been raised so high under FHFA that others, now, find an opportunity to wrest some of their market from them by lowering the bar on fees. I linked the article on this in an earlier message.
We have earnings coming up next week for both Fannie & Freddie. Maybe we will get an up close and focused opinion on the revenue line and whether revenue rises or falls. That matters. Whose accounting skills are superior is irrelevant. Accountancy to me is boring and, as I have said for years, many accountants must have been beaten up as children throughout their formative years for acting like bratty dweebs.
JMHO.
