Replies to post #543791 on Fannie Mae-No Politics (FNMA)

[YanksGhost]

So then there was no need for HERA because the charters took care of everything, years ago? Yeah, right. Try selling that one to anyone.

The Treasury backstop absolutely IS written in the SPSPA. It is there for a reason. It, thus, is part of the law under the operative statute, HERA. And HERA, the law, does not deal in "bailouts"... it deals in a net worth valuation and a financial remedy for negative Net Worth. NONE of that is contained in the charters. NOT ONE WORD.

Want to prove me wrong? Link the part of the charter's text where it say so. It ain't there!

And the rubbish about "the Treasury's right to purchase obligations" has nothing to do with draws given for negative net worth. Negative net worth is an accounting insolvency issue, nothing more. If you wish to define "obligations" in some different way, please provide statutory rationale for doing so.

Thanks.

[Donotunderstand]

when FNMA was an agency of the GOV (think FDIC) there was a charter based tie to Treasury backing'

when FNMA became a public owned company with elements of "Gov" - the explicit relationship was gone - by the action of making it private

what remained - and 99.99% of the street and lawyers and accountants would agree was an IMPLIED guarantee --- i.e. not in writing