Fannie Mae-No Politics (FNMA)

[YanksGhost]

I agree with you and I have made the same point at least a dozen times on this board. However, part of the problem Calabria and FHFA have derives from the rule-making process on capital statutory requirements. Any number of the responses for input specifically advocate for SIFI level minimums. Under the rule-making process, ALL public views expressed must be addressed in explaining the final ruling. Enough sentiment was expressed favoring high standards that it will be hard to justify dismissing the recommendation. J. Timothy Howard did a write up on the public replies and tried to blow off the ones that didn't come from "name" players in Mortgage Finance, but the rule-making process requires them to be given equal rate in weighing the standard unless there is a prima facie rationale for why they are incorrect suggestions.

I might add that the same problem arises on the volume of Utility Model suggestions that were put forth as part of the capital exercise. While not binding on Calabria's "Hello Kitty Plan" whenever it is revealed, the sentiments are certain to carry some weight into his thinking on his FHFA directives.

Even with a 60 day extension, there was so little input from public comments that any recurrent views that were conveyed, like high capital standards or utility modeling, that these recommendations may likely take on a life of their own. I was incredibly disappointed that so few people responded to FHFA.

JMO.