Fannie Mae (FNMA)

[Release us]

You're welcome. I got this from the facebook group "fannie packers" sometimes they have good info that's not on here.

https://www.facebook.com/groups/266253616914518/

But to answer your question:
What does "private capital first loss untenable" mean?
I'm not sure.

Thanks for posting this, it is a good rundown of recent developments. To me the most important point is this:



Quote:
4) general view is that the GSEs are working more effectively than ever. utility returns model is preferred. Large barriers to entry prevent multi guarantor approach plus CSP only built for current GSEs. Private capital first loss untenable. A bit of talk of Ginnie Mae stepping up.


There is a widespread reluctance (that Pimco broke) to admit that the current situation is actually not that bad. A utility model solves the shareholder mistreatment and prevents a return to the days that FnF were run like hedge funds, seeking to maximize shareholder return via aggressive lobbying (and thus stepping on many powerful toes).

What does "private capital first loss untenable" mean? I thought that any future version of FnF would have plenty of private capital to absorb losses. Mnuchin has said as much several times.