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Federal National Mortgage Association Message Board

sew1959a 89 posts  |  Last Activity: 5 hours ago Member since: Sep 16, 2012
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  • Hank Paulson Launched The Big Lie Campaign On September 15, 2008

    February 9, 2016 at 8:28 am, No comments
    It wasn't apparent at the time. But today we can look back and observe how The Big Lie campaign-- promoting the meme that Fannie Mae, Freddie Mac and U.S housing policy caused the financial crisis--was launched just after 1:42 p.m. on September 15, 2008, exactly twelve hours after Lehman Brothers filed for bankruptcy. At the White House, Treasury Secretary Henry Paulson came forward to address an anxious nation and financial leaders.
    Like most doublespeak artists, he couched his message with empty platitudes and vague insinuations. He was never so blunt as the Steve Carell character in The Big Short, who prophesized that, "the banks will blame poor people and immigrants." Paulson's message, conveyed in coded references, was precisely that. His agenda was to reassign the failures of private label securitizations on to affordable housing goals and the GSEs.

    At first blush, his answers seemed to go off on tangents. Or maybe they were non sequiturs. To finance ministers across the globe, he must have sounded utterly clueless, if not mendacious. With hindsight, it seems obvious that Paulson wanted to leave the press corps with two big fat lies.

    Many remember the more famous one, since it made a good soundbite. "I never once considered that it was appropriate to put taxpayer money on the line in resolving Lehman Brothers," he said. Scores of professionals at Britain's Financial Services Administration, at Bank of America, at Barclays, at Treasury and at the New York Fed must have wondered if Paulson had been struck with amnesia. The other falsehood, about the "root cause" of increasingly fragile credit markets, was more oblique.

    Bear in mind, that everybody knew what was going on at the time. Here's what I wrote six days afterward, on September 21st. (The correct date of the piece is here.)

    Paulson keeps referring to a "root cause" that has nothing to do

    Sentiment: Hold

  • Reposting from yesterday. I'd like to point out Bill Maloni's comment after the article. I have copied a similar version of the comment here with Bill's permission:

    "Once again, poor Peter is peddling his soggy potatoes which have been rebuffed/rejected by many knowledgeable U.S. financial observers.

    Before starting, let me note that Fannie and Freddie contributed to the 2008 problem—by purchasing PLS (see below) -- but they hardly were the cause of that debacle. Even the Congress's 1992 imposition of affordable housing goals wasn't the problem, except for ideologues who disdain government involvement in the economy, which is Peter’s lurking issue.

    The Fannie and Freddie mortgages and the mortgage securities they issued between 1992 and 2005 had an exemplary small default and foreclosure level, because they were cautiously and carefully underwritten despite the “goals.” (Read the works of David Fiderer and/or Barry Ritholz.)

    That record is there for anyone willing to read government and media reports to review and verify.

    Here is where friend Peter gets in trouble and resorts to “weasel wording” and political bloviating.

    Peter choses to ignore Wall Street’s calamitous and failed GSE-cloning campaign—from @2004 through 2007—going it alone without Fannie and Freddie; excluding the GSE systems (providing more money for the banks and IBs); to underwrite its own mortgages, using brokers paid by the loan; issue $2.7 Trillion of its own mortgage backed securities (called Private Label Securities or PLS), and get those bonds falsely rated by their captive rating agencies.

    Those mortgage backed securities sold worldwide, failed very quickly when the US mortgage market softened and were the major problem, which made our economic woes an international one.

    Fannie’s and Freddie’s loans/MBS had three times better performance, even in the downturn. (Think about why the banks required over $500 Billion in TARP assistance and the GSEs, only $187 Billion, with most of

  • sew1959a sew1959a Feb 6, 2016 9:47 PM Flag

    a total ninkompoop

  • - February 5, 2016

    Two members of Congress want the Administration to answer a simple, multi-billion dollar question: What could happen as a result of Fannie and Freddie being required to keep no capital?

    Reps. Stephen Lee Fincher, R-TN, and Mick Mulvaney, R-SC, sent a letter February 4 to Treasury Secretary Jack Lew and Federal Housing Finance Agency Director Mel Watt expressing concern about a policy that requires two of the largest companies in the country to send their capital to the Treasury Department every month.

    “We respectfully ask that the FHFA and Treasury consider what effect compelling the GSEs to hold zero capital will have on our financial system and taxpayer exposure, and what specific steps the FHFA and Treasury can take in the near term to rectify the situation,” they wrote, requesting a reply no later than March 1.

    The letter puts the Sweep in sobering context:

    “It is extremely troubling that these massive agencies – deeply imbedded in our financial system with over $5 trillion in securities outstanding – are being specifically directed to deplete their capital reserves. According to the 2013 FHFA report, four out of five mortgages are now backed by Fannie and Freddie, which is a level higher than before the crisis. Should a sudden shock to the system or even a normal downturn occur, it is American taxpayers that will have to fit the bill. The Enterprises would be solely reliant upon drawing from Treasury the capital that they previously transferred – capital which at that point will have been spent by the federal government.”

    The letter also echoed an idea that housing policy experts from across the political spectrum have backed: Treat Fannie and Freddie like systemically-important financial institutions, or SIFIs. The two lawmakers cautioned that they oppose the authority of the Financial Stability Oversight Council to designate firms as SIFIs and have “serious concerns about the transparency of the FSOC designation process.” However, t

  • February 5, 2016

    Two members of Congress want the Administration to answer a simple, multi-billion dollar question: What could happen as a result of Fannie and Freddie being required to keep no capital?

    Reps. Stephen Lee Fincher, R-TN, and Mick Mulvaney, R-SC, sent a letter February 4 to Treasury Secretary Jack Lew and Federal Housing Finance Agency Director Mel Watt expressing concern about a policy that requires two of the largest companies in the country to send their capital to the Treasury Department every month.

    “We respectfully ask that the FHFA and Treasury consider what effect compelling the GSEs to hold zero capital will have on our financial system and taxpayer exposure, and what specific steps the FHFA and Treasury can take in the near term to rectify the situation,” they wrote, requesting a reply no later than March 1.

    The letter puts the Sweep in sobering context:

    “It is extremely troubling that these massive agencies – deeply imbedded in our financial system with over $5 trillion in securities outstanding – are being specifically directed to deplete their capital reserves. According to the 2013 FHFA report, four out of five mortgages are now backed by Fannie and Freddie, which is a level higher than before the crisis. Should a sudden shock to the system or even a normal downturn occur, it is American taxpayers that will have to fit the bill. The Enterprises would be solely reliant upon drawing from Treasury the capital that they previously transferred – capital which at that point will have been spent by the federal government.”

    The letter also echoed an idea that housing policy experts from across the political spectrum have backed: Treat Fannie and Freddie like systemically-important financial institutions, or SIFIs. The two lawmakers cautioned that they oppose the authority of the Financial Stability Oversight Council to designate firms as SIFIs and have “serious concerns about the transparency of the FSOC designation process.” However, th

  • Reply to

    FNMA has $86+ Billion in Cash

    by bagelmasters Feb 5, 2016 11:35 AM
    sew1959a sew1959a Feb 5, 2016 12:40 PM Flag

    that's amazing--considering that they've been giving every cent to the treasury-- how'd that -happen?

  • Reply to

    Tomorrow

    by jms3rd2003 Feb 4, 2016 6:35 PM
    sew1959a sew1959a Feb 4, 2016 10:39 PM Flag

    shorts haven't covered yet----they could be in big trouble----I thought they were smart money----maybe---maybe not-----tomorrow is Friday--could be something big next week

  • Reply to

    Tomorrow

    by jms3rd2003 Feb 4, 2016 6:35 PM
    sew1959a sew1959a Feb 4, 2016 10:36 PM Flag

    All good from now on....I can feel it----up %14.6 today on average volume 18.5 cents

  • In the interim, the Committee urges Congress to adopt a realistic budget treatment of the
    17 assets and liabilities of the GSEs. Doing so includes preventing the misuse of the proceeds
    18 of the guarantee fees charged by the GSEs to investors; such funds are an important risk
    19 mitigation tool to better protect the GSEs and taxpayers from future losses, and should not
    20 be diverted to finance unrelated government programs or initiatives. Additionally, the
    21 Committee strongly recommends that OMB move the GSEs to an “on budget” accounting
    22 standard, as CBO has already done, to provide a more transparent accounting of their true
    23 impact on the federal budget.

  • sew1959a sew1959a Feb 3, 2016 11:30 AM Flag

    What an awesome DUDE. courage of conviction--------he knows

    Sentiment: Hold

  • sew1959a sew1959a Feb 3, 2016 11:28 AM Flag

    GD Hank Paulson thinks he's above the LAW---forking GS mentality-----let's see HIS HEAD HITTING THE FLOOR!!!!

  • (NYSE: AIG) was downgraded to Market Perform from Outperform at William Blair. AIG closed most recently at $55.33 and has a consensus analyst price target of $67.39 and a 52-week trading range of $51.05 to $64.93.

    Sentiment: Hold

  • sew1959a sew1959a Feb 3, 2016 8:42 AM Flag

    By contrast, here, the Companies were in a stable and profitable financial
    position when the Third Amendment was imposed, four years after the financial
    crisis of September 2008.
    CONCLUSION
    The District Court’s decision should be reversed.
    Dated: February 2, 2016 -------We can't post link so you have to take my word on this

  • sew1959a sew1959a Feb 3, 2016 8:34 AM Flag

    that's NOT his personal conclusion----look it up Mr. Moron

  • Reply to

    In my perfect world

    by usesomesense Feb 1, 2016 11:14 AM
    sew1959a sew1959a Feb 1, 2016 12:05 PM Flag

    who is next POTUS? Bern or Trumped up?

  • The Government filed its Response (Doc. 284) to Fairholme’s Motion to Compel late last night. The filing is under seal, so we won’t get to see the Governments justifications for why it believes it has properly withheld more than 11,000 documents in whole or in part from Fairholme today. We should see a redacted copy of yesterday’s filing in a couple of weeks’ time. Fairholme is scheduled to file its Reply by Feb. 1, and it’s likely that filing will be made under seal because it will discuss the content of confidential discovery materials.

    Sentiment: Hold

  • Reply to

    This will be settled

    by harrywhtcox Jan 30, 2016 12:07 AM
    sew1959a sew1959a Jan 30, 2016 11:37 PM Flag

    can you possibly point us to the motion to compel? I can't find it on GSE links

  • Reply to

    This will be settled

    by harrywhtcox Jan 30, 2016 12:07 AM
    sew1959a sew1959a Jan 30, 2016 11:26 PM Flag

    thank you.......now I just have to find it

  • Reply to

    This will be settled

    by harrywhtcox Jan 30, 2016 12:07 AM
    sew1959a sew1959a Jan 30, 2016 10:18 PM Flag

    is there any evidence of a "motion to compel"?

FNMA
1.385-0.025(-1.77%)Feb 9 3:59 PMEST