" The recent price drop from the mid $4's to the low $3's comes as no surprise to me and should also not surprise you" :
I had a thought too but didn't want to hurt your feelings !!!!! Here's a penny for your fannie, Welcome Baaaaack !!!
There's a lot of truth in what you expressed. The stem of their actions, therefore, burgeons from attempts to socialize poverty. To my mind, everyone does not deserve to own a house. Not if they can not pay for it. And particularly if their liability is forced on me because I don't deserve that mistreatment. My piggy bank must remain as my piggy bank. This administration is hell bent on Europeanizing (for lack of a better term) our economy not giving second thought to the reality that our nation was founded and built by those whose sacrifices were driven by different values. We have an inalienable right to keep it that way. That is in principle which separates us from the rest of the world.
The shortest distance between two points is a straight line. That wisdom remains a corollary to the philosophy of Occam’s razor which states that more often than not, the simplest alternative is usually the best option to a complicated problem.
The real problem with the financial crisis was not perpetrated by faulty structure or design, rather it was the deeply rooted neglect of regulation, at all levels. Does America need to replace all its laws to ensure rule of law ? Will that guarantee a better judicial system in our country ? No. What is needed is the diligent adherence to those laws. It’s practice needs to be modified. That is the precise job of the regulators. To make sure that the laws are followed not only in courts but also on the streets, public and private institutions.
The American government has come to believe falsely that our nation can run on auto pilot. That our institution of “checks and balances” will fervently play out our moral and ethical intent. If only that were true. They cannot act as though above the law and hold the world to standards they themselves are derelict on.
The simplest solution to the current mayhem is to change the process of lending for home ownership and leave Fannie Mae and Freddie Mac alone. That will retain the intent and integrity which architected the creation of these institutions, and get the government out from where they don’t belong. The government has received more than their share of capital loaned to the GSEs. Enough shenanigans about “reform”. Reform your own attitude of stealing first. Heal thyself, physician.
Does anything has to mean anything on this MB ? Just enjoy the slapstick humor present in these experts' absolute inside knowledge of what's not known or visible to anyone else. There isn't much difference between conjecture and speculation !!!!!!!
Wont surprise me. American investors have acquired idiocy. Its the new flavor of ice cream everyone wants to advertise "I've got it too" before it melts !!!
kmac, my direct experience with real estate, lending institutions, banks, underwriting insurance companies, property appraisers et al proved otherwise. I've known families with $ 60K annual salaries owning 18 properties valued over a few million, when they could hardly afford one. Yes the top had to be corrupted, because the mayhem took place under their watch. The entire chain was involved without fear of repercussions. I don't know where you got Wall Street telling you what to do.
Amazing these people woke up 7 years after the debacle to realize that origination mortgages should be reviewed immediately at the time of loan processing and not wait for financial failures to happen first. Faulty applications, whether on account of borrower mistakes/oversight/fraudulent intent etc. or lender oversight on account of faulty due diligence/excessive lenience etc. are much easier to identify at initial stages and less costly for all concerned.Fact of the matter remains that neglect was rampant during the seemingly boom years starting from financial agencies who were the first layer of contact with potential customers, to the banks that did the loan underwriting, and finally up the chain to GSEs that appended approvals with government implicit guarantees for backstop. That is the level of excellence our financial systems, agencies and government have achieved in this day and age despite the plethora of rules and regulations that are touted. The executive levels were far removed from the execution layers, and these people imagine "Housing Reform" will solve all future problems. What truly needs reform is their "Attitude" .
That's good to know babyboomerplus. I take it that your systems are designed to keep tabs on major shareholders actions. Can you forewarn when signals start to alert you ???!!!!!
I haven't seen or heard any news on this company for a long time. Seems like the moment the company started its advert campaign, all millionaire shareholders lost interest on the MB. Makes me wonder if I'm left alone.
This research article is by far the most comprehensive and educative one I have read on the subject thus far, and commend the authors for their efforts in proposing a solution to an unprecedented equation, albeit I disagree with the solution. In essence, the authors concede that the government overreached its authority even in Administrative law by disregarding its balance with Corporate Law on numerous fronts :
(1) For one fact, the government disregarded SEC's corporate procedural requisites in self-nominated ownership as the majority shareholder. As the authors claim, the government's failure to structure a lawful "deal" without forethought of consequences "preserved legal rights" for the investors and as the controlling shareholders became subject to the "fiduciary duties to the remaining public shareholders of Fannie and Freddie."
(2) The government in an effort to avert a national and perhaps global financial calamity, chose an alternative to receivership in appointing FHFA as the conservator of the GSEs. Additionally, it chose to "leave a publicly traded float behind to continue to exist [creating] not just fiduciary duty problems but a class of holders to inevitable assert these issues."
(3) The treasury in its agreement with the FHFA, agreed to infuse financing to the GSEs in exchange for its original ownership of 79.9% of the companies (through warrants entitled to 10% dividends but they were never exercised), but failed to gave something in exchange for the third amendment "sweep." That was a hard ball tactic to wipe out the shareholders. Even "privatized utilities, in which a government entity retains a stake, for example, are also not immune from the dictates of corporate law."
(4) "FHFA as a conservator has a conflict of interest in its negotiations with the treasury department (another government agency)"...... "Under Federal Law, receivers of failed financial institutions are required to avoid conflicts of interest like the conflict seen here." The GSEs "are public corporations subject to the full panoply of the federal securities laws for companies that register their shares under the Securities Exchange Act of 1934."
(5) The FHFA as the overseer of the GSEs, in collusion with the treasury and the government demonstrated further conflict in engaging with plans to liquidate the very companies they were authorized by law to preserve and conserve.
The authors also note that "In short, it is difficult to see how creditors benefited in any way from the Third Amendment, while the injury to shareholders junior to treasury is obvious.
Prefaced by their exhausting research, the authors are merely exposing realities and experience in proposing a possible resolution for all parties, given the numerous lawsuits pending presently. However, the predicate of "fair" allowance to a government under financial market upheaval could be balanced with a "fair" compensation to the shareholders. Because they understand and claim (present lawsuits pending), that the Takings argument may face headwinds leading to further impasse. They note "the Federal Circuit has never upheld that a seizure of a financial institution under the statutes and regulations designed to insure safe and secure banking institutions constituted a taking", (reference FDIC case law during Savings & Loan fiasco). "Takings cases are difficult to win."
My personal disagreement with the "fair" compensation rests with the "unfair" means used by the government to decapitate shareholders. Even hindsight does not preclude the government from following corporate law dictates while practicing administrative law under duress. As hard as it might be in the face of experience, the Fifth Amendment "taking" clause should not be abandoned and the government forgiven for their hasty and ad hoc improprieties. There is nothing "fair" about forcefully taking something away from me thereby denying my rights, and then returning 0.01% of it back to me.
The government and courts must consider that it was not the shareholders who caused the debacle with Fannie and Freddie, as opportunistic and speculative as their persona might seem. After all, this huge failure at national and global levels did not happen through overnight osmosis. The shareholders had nothing to do with deficient procedural adherence on the part of banks, lending institutions, GSEs et al. Where were the regulators and the government agencies paid for their service of oversight. In my sparse experience, the "intent of the law" supersedes the interpretation of it. The Fifth Amendment is embedded within the Bill of Rights to ensure that justice is intended for all, when due process is afforded and the rule of law is upheld.
Amy, here's a suggestion. You could take a leave of absence from this MB and spend some time at your Trump Condo and try grabbing The Donald's fancy. You never know he might be the knight in shining armor to save you from your fannie !!!!!!! You might never have to wear shorts again !!!!!! Oh, and do tell us the goodies when you return. Best.
I think bashers do get paid with our money by spooking those who shouldn't be here in the first place. There are a lot of people here who pretend to be owners of FnF but are in reality simply watching from the sidelines, in the hope that they might catch some shares at some inflection point. I am not a trader and believe the confidence of people like Ackman, Berkowitz, Icahn etc who have put money where their mouth is and keep pursuing the good they see eventually. Lets face it, were it not for these people with guts and financial interest in FnF would we have seen the type of movement we have experienced over last year ? Those who have gone ahead with their lawsuits are the real investors and doers. Most here I suspect are talkers.
I'm sure there are a lot of you who have bought millions of shares for a fistful of dollars and hope to be surprised pleasantly and so would I. It seems like most have given up as other sites ignite a greater sense of jubilation. At least if there is larger participation, more dialogue would encourage sharing of info not easily accessible to all.