Fannie Mae-No Politics (FNMA)

[FOFreddie]

Susan Wachter FCIC Interview - Thanks for the reply. My take away is that if she is appointed this interview is a good insight into her views and perspectives unconstrained by current political realities. Perhaps it could be the focus of confirmation questions?

Take aways:

This is a 2010 interview so perhaps outdated but -

1. Wachter is part of the UPENN - Wharton academic community which Biden was affiliated with. She is also part of Elizabeth Warren's network around Boston and Harvard.
2. She predicted the 2008 housing bubble largely caused by lax underwriting based off of the Japanese and Asian housing collapse caused by similar housing market factors.
3. She predicted that interest rate risk will cause the next housing bubble
4. She mentioned GS and John Paulson and others who were shorting the market as early as 2006 - this flies in the face of Hank Paulson's claim( see the Netflix documentary) that he did not see the housing crisis coming when he was at UST. Also want to mention that GS sponsored ABACUS with J Paulson ( ironically - ABACUS is the subject matter of the current GS v Arkansas suit to be decided next week)
5. She takes the position that the GSEs were partially to blame but also mentions Mozillo at Country wide forcing them to take low quality underwriting to keep market share since the liar loans were driving new market participant inroads.
6. It is unfortunate that the questioner did not get to ask the GSE question earlier but in the last 90 seconds she clearly said that certain "regulators" were pushing the GSEs to take ALT A loans in the particular.
7. She was not comfortable naming the regulators for the public record but seemed willing to continue the conversation off the record with the FCIC interviewers as the interview ended. - Maybe something to bring up in confirmation - who were these "regulators" and why?