Remember when Spencer Bachus said that Fannie Mae and Freddie Mac should be in liquidation, not conservatorship?
The issue was discussed during a general session at the American Securitization Forum.
Yeah… About that… Well, the GSEs ain't going anywhere. Here are just a few reasons:
Home prices are increasing.
Negative equity positions are declining.
Foreclosure rates are slowing.
Investment funds pining for more supply to fulfill REO-to-Rental targets.
Private-label securitization is slowing increasing.
The banks and GSEs are making nice again (see: BoA / Fannie settlement), though there's still a ways to go.
The recent CFPB release includes a specific 8-year plan for the role of Fannie Mae and Freddie Mac in the US housing market.
Most importantly… The GSEs are profitable now.
So what exactly is the problem? Nothing, unless you care how much the government is involved with the housing market. If you're looking for re privatization of the mortgage market, with FHA dropping back to a 10-15% market share, there are a few promising signs.
FHFA mortgage guarantee fees ("g-fees") are increasing over time.
Community banks are retaining more loans on their books. According to CUNA's November 2012 report, residential first mortgages comprised more than 20% of their total lending portfolio. By 2005, that figure dropped to 9.8%. As of November 2012, that number inched upwards to 10.8%. Not an enormous change, but certainly moving off of its historical lows.
Fannie Mae & Freddie Mac are moving out on the risk curve, causing FHA to move out on the risk curve opening opportunities for the private market.
Pent up household demand. We have a cohort of 20s & 30-somethings that have been renting since leaving college during and after the housing crash.
Increasing household formation.
In the end, even the activity trends pushing mortgages back to the private market won't overcome the overwhelming effects keeping the GSEs right where they are.
This news is irrelevant to shareholders.
Considering that the Feds are sucking in every dime of profit, all the good news in the world will not move this stock. Sure, you might get a sucker pop, but you can bet it'll quickly bleed back down.
The same Feds owned by the Rothschilds and the rest of the delusional family elites?
In order for someone to win, someone has to lose. In order for the banks to win, we the people have to lose.
The banks and privately owned Federal Reserve have been sucking and draining wealth
from Americans since Woodrow Wilson signed into law the Federal Reserve Act.
Banking elites have been stealing our wealth with impunity and will continue relentlessly until we the people wake up.
We need to elect honest leaders willing to put their lives on the line. Abraham Lincoln, and John F Kennedy are two examples. They did put there lives on the line. They both publicly refuted the powers of the central banks and were killed for it. The history books are incomplete in disclosing everything.
Thank goodness for search engines and the uncensored internet.