Replies to post #841695 on Fannie Mae-No Politics (FNMA)

[Barron4664]

The answer to your question is he can't. Well he can't without breaking at least 5 separate federal statutes to do it. He is surrounded by greedy people who are giving him very bad advice. If Treasury takes ownership of the warrants for 79.9% and sells 3-6%, then under the GAO act and the CFO act, Treasury MUST consolidate the 7-9 Trillion mortgage liabilities onto the Nations Debt. As long as the SPSPA is in affect and grants Treasury non-regulatory control over the GSEs, the Treasury must sell ALL of their shares to avoid consolidation. There are other laws in play besides HERA. So adding 9-trillion in debt to make $30 billion does not make any sense. If these people know what they are doing, it will be something entirely different than the scenarios being debated on this board. Without any details other than GAMC memes and the daily Pulte Posts, we cannot know. 

[Rodney5]

Good morning fdicr,
For Fannie Mae, "quasi government" means it's a privately owned, shareholder-driven company established by Congress to serve a public purpose—increasing homeownership—making it a hybrid public-private entity, a Government-Sponsored Enterprise (GSE) that operates with government backing and oversight but is not a direct federal agency.

Private Ownership:
As a shareholder-owned corporation, Fannie Mae is managed by private employees and is not a federal agency.

Government Sponsorship:
Despite its private structure, Fannie Mae receives government backing which allows it to issue bonds with favorable credit ratings and lower yields

The United States was not obligated after 1968 to back debt of Fannie Mae. The United States Taxpayers became obligated when the government took over the two companies.

Originally, Fannie Mae had an explicit guarantee from the United States government; if the entity got into financial trouble the government promised to bail it out. This changed in 1968. Fannie Mae became a private stockholder owned company. Fannie Mae securities received no actual explicit or implicit government guarantee. This is clearly stated in the securities themselves, and in many public communications issued by Fannie Mae.

Quote: “Although we are a corporation chartered by the U.S. Congress, the U.S. Government does not guarantee, directly or indirectly, our securities or other obligations. We are a stockholder-owned corporation, and our business is self-sustaining and funded exclusively with private capital. Our common stock is listed on the New York Stock Exchange and traded under the symbol “FNM.” Our debt securities are actively traded in the over-the-counter market.” End of Quote.

Information from: Fannie Mae form 10K Dec 31, 2007
part I, page 1, item 1.

https://www.fanniemae.com/sites/g/files/koqyhd191/files/migrated-files/resources/file/ir/pdf/quarterly-annual-results/2007/form10k_022708.pdf