Fannie Mae-No Politics (FNMA)

[camaro4me]

Well that's just great.

jtimothyhoward - MAY 24, 2020 AT 9:09 PM

I’m still sorting through my thoughts about
the proposed capital rule.

While I’m disappointed with it, I can’t say
I’m surprised by it.

Director Calabria has never supported Fannie
and Freddie–either conceptually or in practice
and his capital rule is aggressively anti-Fannie
and Freddie, which means it’s also anti-these
companies’ stakeholders, the homebuyers they
serve and the investors who have invested in
them and soon will be asked to invest
considerably more in them.

My policy interest is aligned with the potential
home buyers who will be penalized by this rule,
while yours is aligned with those who have a
current investment in the companies and wish
to maximize its value.

At this point, however, neither of our views
matter; it’s going to be up to the group of
potential new investors to tell the financial
advisors for FHFA, Fannie and Freddie what
terms and conditions they will require to invest
in two companies whose regulator
does not believe they should exist,
and who will continue to at exert at least
some degree of control over them for
as long as he remains in his position.

At this point I don’t have any advice to give
these potential investors; perhaps at some
time in the future I will.