Good update article. In reality, if a solution is found through Congress, it would require a"tri-partisan support (democrats ,and both the moderate and conservative republican trenches). Remember, it was not solely the lack of democratic party support that failed the Obamacare repeal, but rather discord within the moderate and conservative views of senate republicans. On that basis,I find hard to believe that the senate would have the votes to eliminate the GSE's and replace them with untested systems especially since the GSE's are working so well presently and I would have to feel by now a majority of the members of Congress understand that the 2008 financial crisis , although multifactorial in its causes, had a lot more to do with the big banks lack of discretion , than the GSE's .Further, I find it hard to believe, with the above in mind, that the Administration would want to wait a full year to see if a tri-partisan resolution can be found . If I were in their shoes ,I would want to get a resolution well before the mid-terms ,so as to favor republican support in the election, especially if their grass root support is at risk with the upcoming tax reform.Thus I doubt they would be in favor of extending the GSE jumpstart another year which would likely mean another year of conservatorship. My "guess" they will try to provide an all around solution, perhaps along the lines of the Moellis proposal and Ackman's presentation but modified. They will have something for everyone and enough for the shareholders that would eliminate and/or substantially reduce the threat of the current or possibly new lawsuits.I suspect the arrangement will be similar to the pre crisis arrangements with the exception that the system will be more carefully regulated. The simplest method would be to have the GSE's survive , be released and continue to play a role.Selling everything out to the big banks ,I think would be a political catastrophe for the republicans.
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