Fannie Mae-No Politics (FNMA)

[capitalismforever]

Good post. The most interesting thing about it is this:

[Olson argues that Federal Housing Finance Agency Director Mel Watt has the authority to withhold dividend payments from U.S. Treasury to build a small capital cushion – possibly $3 billion to $10 billion — so they won't be forced to take a draw from Treasury.

If he suggest $3 - $10 billion for a capital cushion which will prevent the GSE's from having to borrow money, imagine how much more the recapitalization requirement will be which is used not only as a capital cushion, but an eliminator to the federal backstop. A $60b requirement is what I believe it will be.