Fannie Mae-No Politics (FNMA)

[Wise Man]

THE SEPARATE ACCOUNT PLAN WAS PURSUED DELIBERATELY.
Not just the very moment that Calabria and Pelosi with HERA enacted a homonymous second UST backup of FnF, inserting it in the Charter Act just below the original one, without including it as an exception to the Fee Limitation of the United States, but also deliberately enacted regulation for a follow-on plan with "the supplemental" CFR 1237.12 that (c) supplements and shall not replace or affect any other restriction on capital distributions by statute (U.S. Code 4614(c)).

Mnuchin and Calabria/Watt deliberately chose another capital distribution restricted as compensation to UST, making clear that the dividend to UST was eliminated to all effects,


which is the condition required to be considered capital distribution (#1 in its statutory definition).

12 U.S. Code §4502(5)(A):
A payment in kind with respect to "other ownership interest" (SPS) in an enterprise, except a dividend consisting only of shares of the enterprise.

And the fact that this new compensation was included in the SPSPA in a brand new clause, making clear that it has nothing to do with the addition to the Liquidation Preference when the cumulative dividend is suspended, stipulated in a different clause.


The DOJ's Perdogar in a letter addressed to the court and justice Alito, sold it as a game changer, based on the Financial Statement fraud in FnF, when it's the same Common Equity Sweep as before, when FnF (and thus, the JPS) need this Common Equity for the financial "rehabilitation" (CET1), as per justice Alito's interpretation of the FHFA-C's Incidental Power that requires to uphold the FHFA-C's Power (soundness).
Justice Alito even called it "4th amendment of the SPSPA", when Perdogar's letter talked about "prior amendments" (in plural), which refers to the 5th and 6th PA amendments, on Sept 2019 and January 14, 2021, respecively (the one of the 4th PA amendment, December 2017, was a one-time $3B SPS LP increased for free, and the origin of the Financial Statement fraud with Mnuchin/Trump, but with Mel Watt this time). Alito aimed to mislead people, so they mistake it for the 4th SPS Certificate amendment of April 2021, a different deed that inserted the prior SPS Purchase Agreement (PA) amendments (it isn't a new agreement by the parties), when secretary Yellen was in office, which is the slogan peddled by the plotters' social media crew. This way, the attempt to get Yellen involved in Fanniegate with her actions and, specifically, in the flawed 6th PA amendment: "Capital Reserve End Date. Warrant. CET1 >3% of TA for the release. Stock offerings", not just with her inaction like nowadays.

Make no mistake. FnF continue to post $0 EPS in their Income Statements, and there is no game changer whatsoever. And you don't need to be accountant to spot that $132B SPS LP is missing on their Balance Sheets.
It's up to you if you get the wrong information from the Bloomberg Terminal that posted $3 EPS estimates from KBW for 2024 and 2025, just after $0 the prior years, from the conman Timothy Howard pointing out that FnF post "a minuscule PER" when it's sky high or N/A when the EPS is negative or $0, expelled abruptly from Fannie Mae with a shocking 300-page report by the OFHEO, or from one of those "attorneys" sent to Fanniegate, called "Midas khompt19" who calls it "off-balance sheet SPS", and claims that the Restriction on Capital Distribution is when FnF are declared Undercapitalized (Capital Classification that don't exist nowadays), when the law states "undercapitalized" in general, and it starts with "IN GENERAL".
The Capital Classification "Undercapitalized" reminds me another reason that proves the existence of the Separate Account plan with the reason why FHFA's Mel Watt lifted the suspension of the 4.2 bps on new acquisitions, funneled to two Affordable Housing funds managed by the UST and HUD.
Another capital distribution (an expense unrelated to the normal business operations) that has its own Restriction on Capital Distribution different to the one that applies to all others mentioned above (USC 4614(e)).
It was explained here. In brief:
-One of the reasons for the suspension is that it would cause FnF be classified undercapitalized (a Capital Classification).
-The evidence of Separate Account is the reason why the suspension was lifted in December 2014. It has to meet: "it isn't contributing to the financial instability of FnF", which at the time, in the midst of a conservatorship, can only be feasible if FnF had fully paid off the SPS, as a one interim goal in the pace to, at least, meet a minimum capital requirement, as per the exception to the general Restriction on Capital Distributions, and it's estimated that the laggard Fannie Mae terminated this task as of end of 2014, one year later than Freddie Mac (as seen in my signature image below). The SPS were paid off also pursuant to the FHFA-C's "Rehab" Power, where put in a solvent condition, meaning the ability to pay its debt obligations, it's also included the repayment of the obligations SPS (it adds up to its Solvency), besides building capital. "Solvency" is not having a UST backup attached, as a low profile judge stated (8th Cir.), but Solvency on its own. Besides "Soundness: return to profitability, despite that a great amount of that profit is later sent to Treasury's coffers", when it's Retained Earnings (CET1)

I get my information directly from FnF's SEC filings and the laws/regulations, I don't take seriously the financial analyses from the judiciary, and I read the 2006 OFHEO report available online.

An authority of FHFA since day one. That is, a Separate Account plan. Not 16 years on, asking the UST for debt forgiveness IMF-Argentina-style, with secretary Yellen preparing another "Mnuchin", that is, preparing a round trip around the world forgiving debt to foreign countries, just after, in several occasions, he swapped their China Debt with the "Belt and Road initiative" for UST debt, which is what Mnuchin did in his last weeks in office. Primarily because FnF would have to pay Income Tax on that amount.

BOTTOM LINE
Either the officials wanted to make sure the law is upheld (the reason Watt lifted the suspension on 4.2bps), deliberately enacting regulation with the supplemental and, even chosing what they knew was restricted to continue the plan of deception, and another key, the FHFA self-corrects: the goalpost is Basel-framework for capital requirements, chosen by the UST for the release in 2011 at the request of the Dodd-Frank law, that necessary need guarantee fee increases.
UST 2011 Report to Congress:


Mel Watt was snubbed. Basel. Focus.

WATT'S 2018 PROPOSED CAPITAL RULE, REBUFFED
2020 re-proposal:
▪️Total Capital=8% of RWA
Watt's =5%+Going-Concern Buffer +DTA (=8%)
Additions:
▪️Tier1=6% RWA
▪️CET1=4.5% RWA
▪️Leverage ratios(ATA)
All Basel-framework(🇺🇸banks too)required by UST in 2011 for the release👇#Fanniegate https://t.co/YTprilk9hw pic.twitter.com/yj2GuadwJv

— Conservatives against Trump (@CarlosVignote) May 16, 2024