Fannie Mae-No Politics (FNMA)

[obiterdictum]

...even FHFA agrees: “As one of the primary
objectives of conservatorship of a regulated entity would be
restoring that regulated entity to a sound and solvent
condition, allowing capital distributions to deplete the entity’s
conservatorship assets would be inconsistent with the
agency’s statutory goals, as they would result in removing
capital at a time when the Conservator is charged with
rehabilitating the regulated entity.” 76 Fed. Reg. 35,724,
35,727 (June 20, 2011). But rendering Fannie and Freddie
mere pass-through entities for huge amounts of money
destined for Treasury does exactly that which FHFA has
deemed impermissible. Even Congress, in debating the
Consolidated Appropriations Act of 2016, H.R. 2029, 114th
Cong. § 702 (2015), acknowledged such action would require
additional congressional authorization." From Judge Brown's dissenting opinion)

Obit, that quote you cite ("even FHFA agrees...") is devastating to majority opinion. I wonder how Millett and Ginsberg can defend their ruling against this?

First, the GSE narrative put forth by Circuit Judges Millett and Ginsburg simply deny the sudden, negative changes to and effects on the GSEs' financial conditions and operations brought on by enacting the net worth sweep. Instead of the actual narrative that includes all statements of fact, there is the government-centered, judge sanitized narrative - Crisis looms, HERA is passed, the GSEs are placed in conservatorships under specific controls, agreements and financial conditions (FHFA, SPSPAs, Treasury draws, senior preferred stock, 10% quarterly dividends, 79.9% warrants), the sweep is enacted to end the "debt spiral" and net income is swept into the Treasury in perpetuity.

Second, for Millett and Ginsburg, restoring the GSEs to a sound and solvent condition, taking appropriate actions to carry on the business of the GSEs, preserving and conserving the assets and property of the GSEs and having the GSEs exits the conservatorships when this is achieved are not essential features of being a conservator.

Thirdly, for Judges Millett and Ginsburg, the FHFA, as conservator, can literally do whatever FHFA deems is in the interests of the GSEs and FHFA as long as it is not outside of FHFA's statutory authority and power. This "whatever" that is within FHFA's statutory authority and power includes depleting the GSEs' capital reserves, capturing all net income, placing the GSEs in an unsustainable financial condition and keeping them in the conservatorships.

Add to this convoluted reasoning and biased selection and interpretation of HERA statutes and statutory language and the sum does not equal to a point by point defense against the Plaintiffs' or Judge Browns's dissent. Rather, all of it amounts to an insistence on the rightness of their position.

So, biased insistence and obtuse reasoning using selected issues and statutes is used instead of considering all statements of fact and the full context of HERA 2008 as written and as intended by the Congressional authors.

Which Representatives or Senators would agree with the notion that the role and mission of a regulatory conservator (FHFA) is to control and contractually bind a regulated entity to Treasury so that the regulated entity moves towards an unsustainable financial condition through contractually depleting a regulatory entity's capital reserves, contractually transferring 100% of the regulated entity's net income to Treasury for use in non-housing finance purposes while contractually holding the regulated entity in conservatorship allowing this gradual process to severely weaken and eliminate the soundness, solvency and assets of the regulated entity?

Source:
Conservatorship and Receivership - Federal Housing Finance Agency - Final Rule (76 Fed. Reg. 35,724, 35,727 (June 20, 2011)
https://www.gpo.gov/fdsys/pkg/FR-2011-06-20/html/2011-15098.htm

Court of Appeals Opinion - Perry
http://gselinks.com/Court_Filings/Perry/14-5243-1662090.pdf