Replies to post #568346 on Fannie Mae (FNMA)

[obiterdictum]

" In other words, the inaction of the legislature over the years is due to their confusion and conflict about what to do. "

Obi,

Thanks, In some way this is true.

This means that lawmakers and administration do not see any better alternatives than the FnF working mode. It is easy for Congress and Administration to settle for incremental reforms.

Not so bcde. In actuality, they clearly imagined alternatives to the GSEs and sought to eliminate them through proposed legislation. The bills never passed because of confusion and conflict over the proposed bills.

Have you read the bills proposed by Garrett (Hensarling), Corker and Warner, Johnson and Crapo, Maxine Waters? All propose alternatives to the GSEs. These were discussed on the forum.

You can view the legislative histories to see the actuality.

Even after 11 years of vicious conservatorship and many decades of lobbying, Financial establishment has failed to convince the Congress to cancel GSE charters and provide explicit Gov guarantees to PLMBS.

This is inaccurate. Legislation has been proposed and even written by lobbyists (ie. Corker/Warner) to do this. However, all failed to pass.

For examples of legislation see: https://bit.ly/332FeVt and https://bit.ly/2LP6xgj - you can also find the legislation mentioned above using this site.

Obi, Thanks,

You are welcome.

Yes, no bill has become law. This is as good as failure to get what Financial Establishment wanted to get.

That is correct. Certain institutions in the financial sectors, for example TBTF banks, joined with, "convinced" and agreed with legislators who proposed legislation to cancel GSE charters, dissolve the GSEs, and establish new companies with explicit guarantees for PLMBS.

The legislators came up with alternatives to the GSEs. However, all of the legislative proposals promoting those alternatives, in the end, failed.