Replies to post #353156 on Fannie Mae-No Politics (FNMA)

[SGINPHX]

Yank...the key word there is RECOVERY. Unemployment has gotten better ( Not near good enough ) and home prices are rising, some areas probably too fast. No one is saying that the interest rates need to stay historically low for 30 YEARS!! you are arguing a mute point, again turning what was asked into another question that answers nothing. You were asked if any other company had the loan loss revenues to carry defaults for 4 years of prolonged losses , assuming a loss rate of 4 million per quarter which as I recall was about right, at the WORST time during the recession! IMO the gov't used the panic that was happening to take these companies. It has already been shown that they knew that the GSE's were about to be profitable and your response is well maybe profitable maybe not??? Once they were shown that they were ( and they have been for years now) ...please explain how you feel that it is OK to just keep taking the profits and not let them recap and get healthy (as ANY conservator is SUPPOSED to do)???
As far as your "scary whispers" ...please! IF investors bought for the rental income ( And I know that happened in the Phx market that I am in ) they bought for the RENTAL INCOME!!! Not to resell or stimulate a market! As far as HGTV flippers LOL I guess I am one lol...I did flip one and it sold to a corporation for executive housing...OHHH...there goes the neighborhood!!! Here comes the bubble....

[brandemarcus]

1. yank, you have been warning about this housing crisis for two years now and I keep telling you look at price -rent ratios. They are nowhere as high as they were in 2005. You will not get the same drop and they were even lower in 2011 when we are judging what level of reserves were adequate.
Is the nasdaq back to 2000 levels , are you worried? Don't earnings justify the prices this time?- (Not an expert on tech sector)


2. Batting practice is not the top of the ninth and six runs ahead.

3. Cash losses on loans were 5.2 billion a quarter for 2010 and 2011, interest income would have covered 70% of those losses. If the losses had continued at the rate of 2010 and 2011, Fannie had enough loss reserves for over 8 years! Blackstone, Hempton, Myself were being realistic, Government and Joe Girardi were/ are crazy.
4. Can you produce those gm numbers and we will compare magnitudes? Take a few days , it will be interesting!

[Donotunderstand]

such an optimist

yup - housing prices will drop as interest rates rise

but

unless we have a massive jump in rate of GDP growth to say 3.5% the interest rate increase will be in very low to normative bounds

housing should coast until the next recession