Fannie Mae-No Politics (FNMA)

[Rodney5]

DaJester, Thank you Sir…

DaJester Quote: “ This isn't quite right either. The Supreme Court said there's nothing unconstitutional to implement the NWS. Just like the govt can take your house away legally, they can also take a business or the assets of the business. There' nothing to legally prevent the NWS even if it's never been done before. That doesn't mean there doesn't need to be compensation for takings.” End of Quote

The SCOTUS upholding the NWS does not change the fact the LP can be paid down and the SPS redeemed under the terms of the LAW OF HERA. The money kept by the Treasury by the NWS should be applied to principle and 10% interest and over payment should be returned to the companies. $301 billion is more than enough to pay the LP and redeem the SPS. Secondary IPO replaces the commitment.

This is the argument of the Cram Down People, they reference the

The Senior Preferred Stock Purchase Agreement Optional Pay Down of Liquidation Preference Following termination of the Commitment.

Quote: “The companies can't terminate the commitment anyway no matter what without Treasury's approval. The funding commitment doesn't have anything to do with the NWS. The funding commitment came into existence when the original SPSPAs were signed in 2008.” End of Quote. WRONG!

The Senior Preferred Stock Purchase Agreement is an illegal contract.

The LAW

HOUSING AND ECONOMIC RECOVERY ACT OF 2008

Quote: “Page 2732

EXCEPTION.—Notwithstanding paragraph (1), the Director may permit a regulated entity, to the extent appropriate or applicable, to repurchase, redeem, retire, or otherwise acquire shares or ownership interests if the repurchase, redemption, retirement, or other acquisition— ‘‘(A) is made in connection with the issuance of additional shares or obligations of the regulated entity in at least an equivalent amount; and ‘‘(B) will reduce the financial obligations of the regulated entity or otherwise improve the financial condition of the entity.’’.

NOTE: REPURCHASE, REDEEM, RETIRE...

WILL REDUCE THE FINANCIAL OBLIGATIONS OF THE REGULATED ENTITY.

Link: https://www.congress.gov/110/plaws/publ289/PLAW-110publ289.pdf

In essence allows the trustees of Fannie and Freddie to go to the market at any time to raise new capital, including new capital with lower dividend coupons, to buy back the Treasury’s senior preferred. Any loyal conservator of Fannie and Freddie would take advantage of this refinancing option to end the bailout arrangement, by paying off the senior preferred in full.


The Senior Preferred Stock Purchase Agreement is an illegal contract.
Explained: https://investorshub.advfn.com/boards/read_msg.aspx?message_id=172666360