Replies to post #681670 on Fannie Mae-No Politics (FNMA)

[Donotunderstand]

I thought it was the R Senate that actually took steps to try and wind down F and F

BO added the NWS

But wind them down - or keep them hostage - or simply take the money ?

[ano]

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“next step toward responsibly winding down” so the first step was also wind-down
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No. The original SPSPAs were signed during the George W Bush administration while Michael Stegman, who said that line, only served during the Obama administration. The Obama administration wanting to use the SPSPAs (plus the NWS) to wind down FnF doesn't mean that the original SPSPAs, which happened during the George W Bush administration, were designed to wind down FnF. Quoting an Obama appointee doesn't prove your point, and thus one of your later arguments is defeated.

The original PSPA were to wind down FnF, it only contains a liquidation end date and not the 4th amendment “terminate conservatorship end date” the PSPA has an open end to the end date, and that is the “liquidation end date”

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with this theory (the reality) the FHFA-C should have acted and should have re-negotiated the deal as it cannot continue forever (“put in sound and solvent condition), this is an inaction of FHFA-C it should have done something about it but it didn’t
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FHFA-C couldn't act alone. If Treasury didn't want to renegotiate the SPSPAs then there's nothing FHFA-C could do about that. The best they could have done was pay the NWS dividends in kind instead of in cash.

that would have been pretty stupid right, the goal of conservatorship is to put in sound and solvent condition, if treasury would have refused this duty it makes the Treasury unreliable a party of last resort, this is something treasury would NEVER EVER want their name attached to

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but in this case, it was inaction that caused the injury, so 4617(f) will have to go as the courts will void the action/inaction taken
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I think you have completely forgotten what 4617(f) even says. Here it is again:
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(f) Limitation on court action

Except as provided in this section or at the request of the Director, no court may take any action to restrain or affect the exercise of powers or functions of the Agency as a conservator or a receiver.
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I’m not sure how to point this out more clearly to you but “no court may take any action at the request of the director” or because “HERA says no court may take any action” then HERA is not answerable to the separation of powers ?

How could a court possibly "restrain or affect the exercise of" an inaction?

Yes well that is the beauty of it, if you do not “conserve and preserve” and siphon of all profits and fail to prevent this action or “now we know” fail to amend this “now we know” 9 years later, it is an inaction of the FHFA, this inaction violates the duty the FHFA has to conserve and preserve, so because it failed to perform their duty, the conservatorship itself is at stake

But you said it best yourself: "so the courts can always take action if ultra vires". That means 4617(f) stays. There is no need to strike it down, and the Collins plaintiffs didn't get anywhere close to asking for it to be struck down. This quixotic quest of yours will require a new lawsuit.

Here we 4 things:
1) The 3rd is ultra vires
2) The 3rd is inaction a failure to amend
3) 4617(f) no court can take action
4) “courts can always take action if ultra vires”

When in 2012 the 3rd was put in place it was not sure how the companies would perform in the future according to the government, then after the companies became profitable the FHFA should have ended the deal in 2013/2014 as it is their statutory duty to put in sound and solvent condition, failing to do this is “inaction”, so to come back on
1) yes it could have made this deal only not in perpetuity, that makes it illegal, then on
2) it should have acted after the companies became profitable again, this is an inaction, also illegal, then
3) because 4617(f) says no court can take any action, how are the shareholder rights protected if it acted upon regulation but it is illegal in common law? Right thus also illegal
4) if something is beyond the powers granted in the legislative branch, the courts can take action per the constitution, the 3th is therefore illegal, was those power are not given to siphon off all profits in perpetuity

So because 4617(f) says it cannot take action, and the 3th is an inaction & ultra virres, the court takes an action to the prohibited action, and therefore it has to go(not only because of this, but also as “for cause” is also an issue in this)

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prospective relief (2012-up) will need to be reversed when the un-redacted documents contain an illegal fact(RFP 1-30), therefore it would be wise just to void the entire PSPA per SCOTUS
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The Supreme Court ruling won't have anything to do with the documents (redacted or not) in the Washington Federal case. Different cases, different allegations, different timeframes.
In addition, the Supreme Court's ruling will come out before any documents in Washington Federal are unredacted. Washington Federal is currently fighting merely to have their case heard (it was dismissed in its entirety by Judge Sweeney); trying to get those case documents unredacted isn't close to the top of their priority list at the moment.

The RFP1-30 are from the Fairholme case 13-1053 in the district court granted on Nov 18, 2019 by judge Lamberth claiming the government must produce RFPs 1-8, 10-14, 15(a)-(d), 16-26, and 29-30

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the powers for a director to determine by himself in his sole discretion to put the companies into conservatorship
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Are you still acting as if the FHFA director could impose conservatorship for any reason at any time regardless of what 4612(a)(3) says?

I guess you are talking about 4617(a)(3), the thing is as long as the documents are redacted the action is executive, as nobody can see them the action is sealed for the public, so executive, if indeed the companies would have failed, the reports on that were wrong from the beginning as “now we know” the companies became profitable again, this question is really hard to comprehend and deserves a separate post, as is intervenes on multiple levels of statutory rights

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the miserable 5% backstop ($200B-$3,7T) from the government can be stricken instantly, it has no use whatsoever
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Completely and utterly wrong. 5% is massive, and represents enough to keep the companies afloat (and thus MBS investors 100% whole) through any reasonable crisis. While credit is not capital and FnF need to build actual capital by regulation, the MBS market cares greatly about that backstop and it would be severely disrupted if that backstop were to disappear. There is an enormous difference between the $49B of capital FnF have on the books (which includes $19B of non-loss-absorbing DTAs) and the $49B plus an extra $200B.

Assumption, you will find no document pre-2008 claiming the implicit needs to change to explicit, pure fantasy

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upto now the warrant cannot be executed as it is part of the PSPA and the 3rd amendment lawsuits
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Wrong. Treasury could exercise the warrants tomorrow if they wanted to. The only lawsuit that involves the warrants at all is Washington Federal, and they only want the warrants factored into a damage award.

The January letter agreement clearly shows that Treasury and the Department of Justice think the warrants are fully legal as is, and the Biden budget includes a warrant valuation that past budgets didn't, again showing that Biden's administration views the warrants as legal and likely intends to exercise them in full.

Yes well that is the thing, the government also thinks the 3rd is legal, while we know it isn’t, claiming is different than being able to say it is legal, on legal grounds, conservatorship was a good idea, now we have a SCOTUS case that claims it was not such a good idea, all a matter of perception and on which side you are, but the warrants cannot be exercised as long as the litigation is outstanding, as the litigation might have a consequence on the warrants, the government doesn’t want to make this stupid move again as it later must correct.

The mess the government makes is huge, it is so huge the conservatorship itself is already unsustainable, I see no forward path for the government, legal/illegal redact/unredact, coercion/free will, statutory/not statutory, authority/ no authority

These claims are not really the easy ones to win for the government, Lucky enough the SCOTUS will soon let us know what is legal and illegal for the FHFA to do