Fannie Mae-No Politics (FNMA)

[NeoSunTzu]

I would like to caution and implore everyone to be as proactive and vocal as possible in fighting against the full execution of the warrants. Everyone is giddy and light-headed now with all the rosy financial scenarios and the fact that we have an ostensibly "pro-release, pro-shareholder" team coming into office, but I assure you NOTHING ever goes fully according to plan without significant complications, back steps, and other unforeseen pitfalls.

As a case in point think about the financial establishment and government's plan to kill the GSEs; THAT WAS THEIR PLAN! Do NOT believe for a second they will not try to extract more than their pound of flesh, both now and over future time periods, which will be virtually GUARANTEED if we cave on the full warrant execution. This WILL set in stone the lion's share of past, present, and a good portion of future profits to the government while we receive the smallest portion with an unknown and uncertain future full of corporate actions, varying economic scenarios, regulation, congressional actions and on and on with a virtual endless list of potential drawbacks. It is a give away to the very criminals which tried to destroy you, me, our shareholder rights, and our families' future wealth.

I am NOT against the whole concept of the "art of the deal," but full execution is beyond ridiculous in light of all this government has done to bleed or destroy shareholders - even explicitly stating they would NEVER allow these companies to be profitable again a la the Net Worth Sweep - INSTITUED THE VERY MOMENT THEY LEARNED THE GSEs would be wildly profitable well into the future!!!! Please Google and research the Congressional testimony regarding the Warrants. Congress drilled adminstration officials hard on those warrants - they were NEVER intended to be executed; the stated purpose was as a deterrence. The entire government narrative on the conservatorship blaming the GSEs for the 2008 financial crisis depends heavily on your historical, economic, housing and mortage market, and financial ignorance (as summarized below), and the full execution of the warrants depends heavily on your subservience to and belief in big daddy government as your savior - giving you back some of the property they stole in its entirety and allowing you some pittance of an allowance. We should fight hard for full restoration with a modest conciliation to allow the government to save face BUT FULL EXECUTION OF THE WARRANTS is a much much larger defeat than you can quantify at this point in time.

Allow me to reiterate a number of factors against the government narrative:
1.) Although the narrative is to blame the GSEs for the 2008 financial crisis it was in fact the GSEs who performed best of all the financial companies during that crisis
2.) It was the private label mortgage backed securities and sponsoring banks/mortgage companies which failed miserably during the crisis
3.) The MASSIVE IMPLOSION of the financial industry was NOT due to mortgages nor MBS - especially NOT the GSE products; it was due to the MASSIVE and UNPRECEDENTED leverage of unregulated financial derivatives and associated products that investment banks and Wall Street created - we all know Hank was brought in to save Wall Street and the most obvious way was to use the GSE piggy banks
4.) Wall Street, Investment banks, and U.S. Commerical banks WERE SAVED BY the $700B TARP program, then CONFISCATING ALL OF THE GSEs EQUITY (then "loaning" it back to us! what a farce!) and running the liquidity through the Treasury which allowed both the Fed and Treasury to in essence "refund" banks for all of their underwater mortgages and MBS, pay their executive bonuses, save them from their MASSIVE DERIVATIVE LOSSES and FINALLY, SAVE THEIR REPUTATIONS BY BLAMING THE GSEs ....

The above list is NOT even close to a full exposition of the corruption, fraud, deception, and thievery. Furthermore, full execution of the warrants and letting the government off the hook will set ugly precendents for the future on everything from warrant issue, pricing, and execution, to conservatorship law, well-functioning market theory, and shareholder rights and beyond. We will once again in the future rue the day we allowed this surreal ruse to have taken us all in. All of the above DEMANDS FULL REMUNERATION TO SHAREHOLDERS TO KEEP THE FUTURE GOVT THIEVES AT BAY!