Fannie Mae-No Politics (FNMA)

[FOFreddie]

Thanks Guido - Can the proceeds of the warrants be used for anything but deficit reduction? It seems that this is how TARP was structured also?

This is Footnote 24 from Calhoun's Brookins White Paper:

24 If the warrants are sold by Treasury itself, the proceeds would go to the general fund for deficit reduction. See 12 U.S.C. § 1719(g)(2)(C). “The Secretary of Treasury shall deposit in the General Fund of the Treasury any amounts received by the Secretary under this subsection, where such amount shall be “(i) declared for the sole purpose of deficit reduction; and (ii) prohibited from use as an offset for other spending increases or revenue reductions.” Alternatively, Congress could mandate this use of the warrants. The TARP programs in which administrative modifications and waivers were made to the agreements include a similar provision regarding the disposition of the proceeds. See 12 U.S.C. § 5216(d). 25 12 U.S.C. § 1421 et seq.;

Maybe Kthomp has an opinion?