Replies to post #767381 on Fannie Mae-No Politics (FNMA)

[JosephS]

Court ruled that FHFA is under control of executive branch. It was not and cannot be an arms length agreement as such

[HappyAlways]

DJ, SCOTUS was under tremendous pressure just before they announced the verdict. There were calls from Senate/Congress that the administration should examine the 10 years travel records of the justices. Maybe another coincidence. One justice has his name appeared in a list, that big names were invited to an island for some major entertainment. But, his name is too common so no follow up. I read all these from internet. Not sure they are true.

[Donotunderstand]

Just because it is not illegal for the FHFA or any government agency to take a specific action does not mean there will be no remedies to any impacted parties. The recent jury verdict being the first example we've seen.

Not sure WHERE or WHEN we work with the above from another poster

SURE SOUNDS like a taking (of property)
GOV can do it - even pretty heavy handed
BUT the GOV must pay the injured party

[kthomp19]

Just because it is not illegal for the FHFA or any government agency to take a specific action does not mean there will be no remedies to any impacted parties. The recent jury verdict being the first example we've seen.

This is correct. However, all it means regarding a senior-to-common conversion is that legacy common shareholders will have to pick up the pieces afterwards. The dilution wouldn't be undone.

This is exactly the type of "bad faith" dealings I think will be less frequent.

That happened when FHFA still had its director enjoy removal only for cause. Now that the President can fire the FHFA Director (as well as the Treasury Secretary) at will, I expect not-arms-length dealings between the two agencies to be more frequent.

The FHFA and the Treasury should be (and should have always been) negotiating at arm's length

There's that troublesome word "should" again. Yes, they should have been negotiating at arms' length. Yes, it appears that they haven't been doing so. But so what? All self-dealing and fiduciary duty claims that various plaintiffs have brought were been shot down.

it's painfully obvious the FHFA is doing what is in the best interest of the Treasury, and not necessarily the regulated entities to emerge from conservatorship

The Supreme Court said that's perfectly within FHFA's purview as conservator. That's just reality that we have to get used to, no matter how much any of us thinks that it should be otherwise.

[ewtrader]

Link for History of Eminent Domain - where Government - Takes for Public Use - Proper Compensation is required - not Penny’s on the dollar -

https://www.justice.gov/enrd/history-federal-use-eminent-domain#:~:text=However%2C%20the%20Fifth%20Amendment%20to,property%20owner%20for%20the%20fair