All About The Coverup....
So much about the Conservatorship makes absolutely no sense.
We suspect that the Government is reluctant to release the GSE's because they can continue to steal the $Billions in GSE profits. But, the relatively few $Billions expropriated from the GSE's is a drop in the bucket compared to what the Government adds to the deficit without any thought whatsoever. Virtually, nothing in comparison.
We suspect the TBTF banks want to eliminate the GSE's in order to obtain a monopoly on home mortgage lending, basically stealing the market from Fannie and Freddie, with the Government being complicit in the theft.
But, at the prices at which F'n'F stocks are trading, the TBTF banks could simply BUY the GSE's at a price which is literally a steal, at least enough stock to exercise full control over them, and then have their Government lackeys release / recap / relist the GSE's, all with huge upside, and accomplishing the same goal: domination of the mortgage lending market.
A theory which I have been entertaining lately is that most, if not all, of that which drives the ongoing Conservatorship is covering up the wrongful, if not illegal, seizure of Fannie and Freddie and all their profits by the Federal Government in collaboration with the TBTF banks. I suspect that if The Twins were fully restored to the shareholders, than all the skeletons in the closet, dressed in dirty laundry, would be fully exposed.
However, I don't think that much would come of exposing the massive Government/Big Bank Fraud. Look at Wells Fargo: basically a criminal enterprise masquerading as a bank, engaged in a variety of fraudulent schemes, over and over and over again. No One from Wells has been prosecuted for these crimes. Sure, the bank (that is: the WFC shareholders) have had to pay some pretty steep fines, but none of the perpetrators have wound up in jail where they most certainly belong.
Furthermore: the Average American has no sense or understanding of the financial crisis or the Conservatorship. The Guy On The Street probably thinks "Fannie and Freddie" is a Norman Lear sitcom from the '70's. Add to this the fact that by and large most Americans have no political or economic power, and I think the Big Banks and their Federal Government lickspittles (both Democratic and Republican) have nothing to worry about from their crimes against GSE shareholders being exposed.
So, to the TBTF Banks: don't worry about your crimes being exposed, nothing is likely to come of it. You are taking the long way around stealing the housing market - it can be completely stolen today for about $2 a share, a fraction of what it's worth. Simply buy a controlling interest in F'n'F outright on the open market, and order your Government stooges to recap/release/relist/repay the GSE's.
You could even claim you saved the housing market and prevented another Government Bailout.
