Fannie Mae-No Politics (FNMA)

[obiterdictum]

First, the GSEs had no say in the Third Amendment because FHFA's Acting Director Edward DeMarco is the sole authority over the managment and operations of the GSEs. He represents them by law.

Second, it was the profitability and solvency of the GSEs that prompted the Third Amendment.

Third, the main goals of the Third Amendment was to gut the GSEs. The Third Amendment does this by taking all profits every quarter except a capital reserve that would gradually be reduced to zero by 2018, while reducing the GSEs investment portfolio by 15% annually. The stated general purpose of the third amendment was:

Acting upon the commitment made in the Administration’s 2011 White Paper that the GSEs will be wound down and will not be allowed to retain profits, rebuild capital, and return to the market in their prior form.

Finally, DeMarco's assent to the US Treasury's Third Amendment was a direct violation of his fiduciary duty to keep the companies in a sound and solvent condition. How can that be done if all profits are taken and capital rebuilding is prevented? It cannot. The moves were to wind down and dissolve.

So, it was collusion between the agencies, between DeMarco and Timothy Geithner, the Treasury Secretary at the time in direct violation of HERA 2008 (See Perry Capital lawsuit).

The glaring evidence of the collusion is found in the Third Amendments signed soley by DeMarco and Geithner.

http://www.treasury.gov/press-center/press-releases/Documents/Fannie.Mae.Amendement.pdf
http://www.treasury.gov/press-center/press-releases/Documents/Freddie.Mac.Amendment.pdf

That is why both are beiong sued.