Fannie Mae-No Politics (FNMA)

[kthomp19]

The unmistakable truth is that FHFA abided critical under-capitalization for 10 years but, suddenly now, a provision in HERA requires properly defined "core capital" to be present?

The justification for each FHFA director to not set capital standards has been that the companies are in conservatorship. This would all go out the window once the companies are released.

Calabria also seems much more willing than his predecessors to actually fulfill all his obligations under HERA. HERA is his baby; he has said many times that he helped draft it and that any time he does something, he will look at the statute first.

Short version: I believe all other FHFA directors have been violating HERA by not setting binding capital standards, and that Calabria will not continue that trend.