Fannie Mae-No Politics (FNMA)

[clarencebeaks21]

To play devil’s advocate. Notice that FHFA reiterates ALL disjunctive outcomes:

“…OR winding up the affairs of [the Enterprise].”


To play further. The next statements flex to easily include all options:

“That definite and limited statutory purpose does not authorize an indefinite conservatorship. FHFA is in the process of preparing each Enterprise to responsibly exit conservatorship consistent with its statutory mandate and the FHFA
Director’s other duties. Finalization of the Enterprises’ regulatory capital framework is a key step in that effort. Finalization of the Enterprise’s regulatory capital framework is also required by law.”


FHFA nowhere asserts that the steps above preclude winding up of affairs. To the contrary, FHFA specifically qualifies its descriptive comments as process-dependent, preliminary, and open-ended (“is in the process of preparing…” and “to exit”).

Read the Enterprise Capital Rule against the recent requirement to submit a five year ECR-compliance plans. The application of one to the other furnishes the Director with a sound basis by which to justify his final decision whatever it eventually is: reorganize, rehabilitate or wind up affairs. And considering that five years will neatly precede the Warrant execution deadline, the “indefiniteness” comment can just as easily justify an outcome other than rehab. Both reorg and windup, are exits.