Fannie Mae-No Politics (FNMA)

[Donotunderstand]

With the caveat I do not fully understand all the implications of the "actions" suggested

If the ideas in this "editorial" were packaged - it might not be bad at all

First - this is one hell of a distance for the WSJ to go as it imagines and even predicts life for FNMA forward !

The one change I would put to the list (which would then be argued and debated as a list if Congress reads the article)

The 10% dividend payment PLUS repayment of seniors before capital is accumulated and then jrs are paid is way too high a burden

I could see instead - eliminate the 10% dividend - arguing that FNMA and Freddie have already paid x $$ and more money towards dividend is crazy

Then leave the sr preferres out there with all cash sent to the Treasury from here out reducing that obligation - to include DTA payments and write ups of loss reserves - put a cap of say 5B a year of such payments

Then yes burden FNMA with various obligations - but make it a level playing field - any LARGE bank must also do the same and get the same guarantee from GOV

and let the best man win

something like that - better thought out by someone who does not hate FNMA and present a list that is in total too ugleeeeeee