Fannie Mae-No Politics (FNMA)

[Robert from yahoo bd]

Interesting, PRIOR TO THE IMPLENTATION OF THE 3RD AMENDMENT, THERE WOULD HAVE BEEN A COMMITMENT FEE OF ZERO:

"Given the Companies’ return to
profitability, the market rate for the periodic commitment fee in 2012 and after would have been
zero."

Uncle Sugar, DID YOU EXPROPRIATE THE SHAREHOLDERS PRIVATE PROPERTY FOR YOUR OWN EXCLUSIVE USE, INTO PERPETUITY?

"As a Staff
Report from the Federal Reserve Bank of New York acknowledged, the Net Worth Sweep
“effectively narrows the difference between conservatorship and nationalization, by transferring
essentially all profits and losses from the firms to the Treasury.” W. Scott Frame, et al., The
Rescue of Fannie Mae and Freddie Mac at 21, FED. RES. BANK OF N.Y. STAFF REP., no. 719"

"These massive influxes of cash began to arrive just when the government was
confronting the statutory debt ceiling and accompanying political deadlock. See Jody Shenn &
Ian Katz, Fannie Mae Profit May Swell Treasury Coffers as Debt Limit Looms, Bloomberg (Apr.
8, 2013), http://www.bloomberg.com/news/articles/2013-04-08/fannie-mae-profit-may-swell-
treasury-coffers-as-debt-limit-looms. And because they were characterized as “dividends,” and
not a redemption of Treasury’s Stock, the Pay It Back Act allowed the cash to be used for the
government’s general operating expenses rather than only for debt reduction. See 12 U.S.C. §
1719(g)(2); 12 U.S.C. § 1455(l)(2); 12 U.S.C. § 1455 note."

"The effect of the Net
Worth Sweep is thus to force the Companies to operate in perpetuity on the brink of insolvency
and to prohibit them from operating in a safe and sound manner. Indeed, HERA itself recognizes
that a fundamental aspect of the Companies’ soundness is the “maintenance of adequate capital.”
12 U.S.C. § 4513(a)(1)(B)(i). "

"Allowing Fannie and Freddie to rebuild their capital levels, however, would
make that political decision more difficult to explain and sustain. The Economist stated the
obvious in reporting that the Net Worth Sweep “squashe[d] hopes that [Fannie and Freddie] may
ever be private again.” Back to Black, THE ECONOMIST, (Aug. 25, 2012 http:goo.gl/1PHMs."