Brooge, I am pretty sure, according to the above listen that the Primary Mortgage Market is pressing hard to lift the caps designed by MC to shrink the gses footprint! They also will likely take a crack at eliminating the 50bp adverse market fee!
Sandra L Thompson won't be easily hoodwinked by the incessant demands put upon her by the tbtf banks and the Primary Mortgage Market. This ain't her first rodeo and having spent 20 years at FDIC before joining FHFA in 2013, unlike the clueless USSCT Justices she should know all too well exactly about the primary mortgage markets role in taking down the world economy during the GFC.
Sandra L Thompson seems all about subsidizing mortgage access and mortgage rates for minorities at the expense of the wealthier income spectrum of the middle and lower to middle upper income households that MC had been targeting in his low risk credit and high immediate capital build and who largely are the major recipients of 2020-2021 mortgage refi boom!
MC realized that if the gses were to EVER exit Conservatorship, he and SM would have to recapitalize them. This in his vision looked like: (1) Grow earnings asap while minimizing risk (2) Renegotiate the commitment UST line of credit with SM with an appropriate commitment fee (3) try to settle some or all the lawsuits with a $5 billion maximum cap on pending unresolved Litigation and (4) do a new equity offering.
The new administration, Yellen and Sandra L Thompson probably ALL SEE EYE TO EYE ON THE FUTURE DIRECTION OF THE GSES, namely to increase mortgage access RESPONSIBLY (at least optically) to minorities and have a cross subsidization from the more wealthy Americans (who do you think is picking up the tab for the 2 million plus forebearances, ITS THE CURRENT REFINANCERS).
It wouldn't surprise me if Sandra L Thompson IS the next FHFA Director. On the other hand, JB'S closest advisors may have a different person in mind for a 5 year term!
It will be telling to see who it is!
That said, once the new administration decides whatever the hell it wants to do, JB can instruct Yellen and his new Director whatever his vision is in a 5th Amendment that could be 180 degrees different than the 4th Amendment.
Stay tuned, the twisted saga of the 12.75+ year conservatorship will likely continue for some time.
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