Fannie Mae-No Politics (FNMA)

[obiterdictum]

"As the Treasury plan states, this is done to increase competition in the secondary mortgage market."

Obi, Thanks,

You are welcome bcde

Financial establishment is working very hard to get Gov explicit guarantees for private MBS using every possible trick. This is the main reason for continued Conservatorship. FHFA Conservatorship has violated every possible law but still all three branches Gov and media have done nothing much to end this lawless conservatorship.

There is no way any one can trust financial establishment (Wall street bankers, traders, MBA and think tank lobbyists). When was the last time the financial establishment ever promoted competition to make things better for common people? This is how financial establishment has fooled the people all along.

One can clearly see what happened when the financial establishment was freed from the Glass-Steagall Act. Within few years, financial establishment created worst financial crisis (2008) of the century through dishonest and fraudulent profiteering. Also one has to look at how the financial establishment has used its iron grip on Gov, to destroy the competition though lawless FHFA conservatorship.

GSEs were started decades back to help common people to own homes and escape from the clutches of loan sharks and evil landlords. There is no way competition is going to substitute Gov affordable housing policies.

Most lawmakers know these facts, and there is no support for removing the GSE charters. Also there is no way lawmakers will approve Gov explicit guarantees for private MBS. This is the lesson all have to learn from 11 years of lawless conservatorship.

There is a clear multi-level political divide on this issue of federal charters.

There are legislators who do not want the federal government involved in housing finance and want free market enterprise activity to determine housing and company outcomes, not the federal government. There are legislators who want the federal government to control the financing and direction of the secondary mortgage market and seek to continue to nationalize and directly control the GSEs goals and actions. There are those who see a hybrid solution of having a paid for government backstop while having the companies privatized. There those who want to dissolve the GSE and create new companies. Most legislators have no clue of what is to be done and follow the agenda of their party affiliation. In other words, the inaction of the legislature over the years is due to their confusion and conflict about what to do. The evidence is found in the plethora of failed legislative proposals. It is not black and white.

For examples see: https://bit.ly/332FeVt and https://bit.ly/2LP6xgj