Fannie Mae and Freddie Mac about to take off big time.

[thombiz]

Hi Mac, I cleaned up my posts eliminating all the blog bs and have posted the cleaned up version here, above and below your post.

[thombiz]

Here is a timeline for the Conservatorship of FnF I created to show the progression of things.

TIMELINE FOR GSE CONSERVATORSHIP
_____________________________________________________________
1992 Congress passes Fed Housing Enterprises Financial Safety & Soundness Act of 1992 HERA modifies the Act of 1992 so it is part of HERA
improves regulation of FnF, http://www.hud.gov/offices/adm/hudclips/acts/hcdatitle13.txt
_____________________________________________________________
30’s – ‘13 Housing Bubble Timeline, Wikipedia:
http://en.wikipedia.org/wiki/Timeline_of_the_United_States_housing_bubble
_____________________________________________________________
2006 Housing Bubble Bursts / Market Correction
http://en.wikipedia.org/wiki/United_States_housing_market_correction
_____________________________________________________________
7.26.07 Paulson Says Subprime Rout Doesn't Threaten Economy,
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=arhcov9ThQM8
_____________________________________________________________
9.19.07 The Subprime Lending Disaster and the Threat to the Broader Economy. Testimony
Before the Joint Economic Committee, http://www.gpo.gov/fdsys/pkg/CHRG-110shrg38426/html/CHRG-110shrg38426.htm
_____________________________________________________________
7.30.08 Bush signs Housing Economic Recovery Act - 2008. HERA modifies Act of 1992. http://georgewbush-whitehouse.archives.gov/news/releases/2008/07/20080730.html
Authorizes Treasury to purchase obligations of GSE’s; reforms regulatory supervision of GSEs; establishes FHFA; provides homeownership assistance & reforms to mitigate recent increases in foreclosures; and contains housing-related tax incentives and other tax provisions.
_____________________________________________________________
9.07.08 Treasury to Rescue Fannie and Freddie http://www.washingtonpost.com/wp-dyn/content/article/2008/09/06/AR2008090602540.html?hpid=topnews
_____________________________________________________________9.07.08 FHFA puts GSE’s in Conservatorship. Q&A’a from FHFA about Conservatorship.
http://fhfaoig.gov/LearnMore/FAQ
_____________________________________________________________9.08.08 Presidential press briefing “about the GSE’s http://georgewbush-whitehouse.archives.gov/news/releases/2008/09/20080908-4.html
_____________________________________________________________
10.3.08 President Bush signs TARP into Law, http://www.treasury.gov/initiatives/financial-stability/TARP-Programs/Pages/default.aspx
_____________________________________________________________
10.07.08 Taking Urgently Needed Action to Stabilize Our Markets http://georgewbush-whitehouse.archives.gov/news/releases/2008/10/20081007-6.html
_____________________________________________________________
10.11.08 Fannie, Freddie to Buy $40 Billion a Month of Troubled Assets http://www.bloomberg.com/apps/news?sid=aDjJYMSphyM0&pid=newsarchive
_____________________________________________________________
5.20.09 Fraud Enforcement and Recovery Act of 2009 signed by Obama. Creates commission to determine causes of the current financial and economic crisis in US. http://www.gpo.gov/fdsys/pkg/PLAW-111publ21/pdf/PLAW-111publ21.pdf _____________________________________________________________
12.20.10 Memorandum for Secretary Geithner, makes clear the Administrations commitment to ensure existing common equity holders do not have access to positive earnings of the GSE’s, http://timhoward717.files.wordpress.com/2014/06/treasury-memo-smoking-gun-2.pdf
_____________________________________________________________
1.27.11 Findings of the Commission set to determine causes of economic crisis. The Commission's final report was initially due to Congress on December 15, 2010, but was not released until January 27, 2011. Voting on adoption of final report split evenly along party lines. Findings of the Commission: http://en.wikipedia.org/wiki/Financial_Crisis_Inquiry_Commission Only mention of GSE’s is: “to place the GSE’s in conservatorship, followed by its decision not to save Lehman Brothers and then to save AIG increased uncertainty and panic in the market."
_____________________________________________________________
2.2011 Obama Administrations publishes White Papers February 2011 recommending wind down of GSE’s http://www.treasury.gov/press-center/press-releases/Pages/tg1059.aspx
_____________________________________________________________
2.2011 Treasury and HUD release report to Congress recommending wind down of GSE’s
http://www.treasury.gov/initiatives/Documents/Reforming%20America%27s%20Housing%20Finance%20Market.pdf
_____________________________________________________________
2.2011 Phasing in 10% downpayment requirement, http://www.treasury.gov/press-center/press-releases/Pages/tg1059.aspx
_____________________________________________________________
10.20.14 U.S. regulator (FHFA) targeting lower down payments on mortgages (to 3% down
payment) https://finance.yahoo.com/news/u-regulator-targeting-lower-down-184251826.html
_____________________________________________________________
2.21.12 FHFA’s Strategic Plan for GSE’s “Next Chapter in a Story that needs an ending.” Adds “winding up the affairs” p.2 to the definition of Conservatorship. This is in conflict with the US CODE and is in conflict with HERA. Plan also sets goal to “Build New Infrastructure for the Secondary Mortgage Market”. This failed to materialize. http://www.fhfa.gov/AboutUs/Reports/ReportDocuments/20120221_StrategicPlanConservatorships_508.pdf
Declares: this plan is consistent with each of the housing finance reform frameworks set forth in the white paper (Feb 2011)
_____________________________________________________________
8.17.12 Treasury Department Announces Further Steps to Expedite Wind Down of Fannie Mae and Freddie Mac, Full Income Sweep of ALL FUTURE EARNINGS of GSE’s announcement http://www.treasury.gov/press-center/press-releases/Pages/tg1684.aspx

“Acting upon the commitment made in the Administration’s 2011 White Paper that the GSEs will be wound down and will not be allowed to retain profits, rebuild capital, and return to the market in their prior form.”
_____________________________________________________________
8.17.12 text of Full Income Sweep amendment: http://www.treasury.gov/press-center/press-releases/Documents/Fannie.Mae.Amendement.pdf
_____________________________________________________________
2012 – 2014 Quarterly Fannie Financial Reports. These prove FHFA knew the GSE’s were already very profitable, that they returned $23 billion to the Treasury before the Sweep Amendment was put in place. http://www.fanniemae.com/portal/progress/quarterly-performance.html and http://www.fanniemae.com/portal/about-us/investor-relations/quarterly-annual-results.html
_____________________________________________________________
5.13.14 The 2014 Strategic Plan for the Conservatorships of FnF,
http://www.fhfa.gov/aboutus/reports/reportdocuments/2014strategicplan05132014final.pdf
This document erases the inclusion of the Feb 2011 White Papers. Rule of Law restored.
_____________________________________________________________
9.30.14 Judge Lamberth dismissal of Perry Capital / Fairholme Funds Lawsuits,
https://timhoward717.files.wordpress.com/2014/09/93014-order-perry-injunction-2.pdf

[mac]

For the most recent case, a class action, case, you posted the order by Judge Lamberth, which was an order to dismiss the case against the Federal Housing Finance Agency (FHFA). How to get from there to an abuse of power by FHFA? You still haven't told me how you rationalize the broad authority under the TARP.

[thombiz]

TARP is not the problem. Nobody has an issue with TARP. For those wandering about TARP see: http://www.treasury.gov/initiatives/financial-stability/TARP-Programs/Pages/default.aspx The Troubled Asset Relief Program (TARP) is a program of the United States government to purchase assets and equity from financial institutions to strengthen its financial sector that was signed into law by U.S. President George W. Bush on October 3, 2008. Nobody has a problem with TARP. The problem is the WHITE PAPERS published by the Obama Admin on Feb 2011 and then implemented without a vote of Congress. The White Papers were just that....White Papers, not law, never voted on by Congress. They are the complete opposite of what was law and passed by Congress....HERA. Obama substituted White Papers for HERA without congressional support. Definitely "Questionable"! Can he do that?

[uwindsurf]

I clearly lack Mac's beautiful mind. As a result, I am at a loss as to what the point of this thread is. Is it an attack on Obama or is it advice to purchase securities?

Please clarify. To accommodate my addled mind, please be succinct.

[thombiz]

This is NOT an attack on Obama. Obama will be judged by his own actions, not by me. A law is passed by Congress called HERA. HERA creates FHFA to supervise Fannie and Freddie. FHFA's only job is to enact HERA period. That job is to put Fannie and Freddie in sound and solvent financial condition, period. Congress does not pass any further laws. Period. Obama doesn't like Fannie and Freddie and wants to get rid of them so he can create new housing finance infrastructure, period. He gives some ideas to congress about what he wants. These ideas are called the White Papers 2/2011. Congress looks at them then throws them aside. Congress never votes on them. Obama is impatient. He wants his name on housing finance infrastructure so he goes ahead and starts implementing the White Papers, period. Thru the Treasury, he directs FHFA to just forget about HERA and start enforcing his White Papers. He can't ignore HERA, that is unconstitutional. Congress passed it as law. He must follow the law. He chooses to ignore the law and substitute his concept which is not law. It is just some ideas Congress could not agree on. He cannot replace a given law with something that isn't law. That would be unconstitutional. That would be an impeachable offense. It would be a defiance of law. period. The fraud he created must be undone. In undoing the fraud, injured parties must be made whole in compliance with laws. Making Fannie and Freddie whole means billions of dollars will be returned to them. They will instantly become very profitable, The stock will go from $2.25 to somewhere around $40 to $100 a share. I can't make it any simpler than that. Period.

[uwindsurf]

Where are the billions of dollars being returned to the Fannies coming from?

[thombiz]

There are laws which state that federal fraud must he handled by US Courts. The Courts determine who the burdened or harmed parties are, it determines the order in which harmed parties are made whole, and it determines appropriate restitution. This is all part of the US CODE.

Billions could come from overpayments Fannie and Freddie have already made to the Treasury ($187 billion + 10% interest).

Be proud, you are the first to get what I'm saying. You must not know you have a beautiful mind also.

Hello and welcome aboard to Rick C., a dear friend from the past who is better at this than I.

[uwindsurf]

http://www.blbglaw.com/cases/00223_data/Fannie-FreddieConsolidated_Amended_Class_Action_and_Derivative_Complaint.PDF

http://www.valuewalk.com/wp-content/uploads/2014/09/93014-memorandum-opinion-perry-injunction-2.pdf

[thombiz]

Good Find youwindsurf. The first is a suit filed in 2013. My discovery of Obama's use of the White Papers happened around Oct 21, 2014. The plaintiffs had not yet come to know what I exposed. They are arguing the wrong thing. So far, I'm the only person to show the connection of the White Papers to the Sweep amendment.

As for the second find, Judge Lamberth's dismissal was the very reason I started my search. He found fault with the way HERA is written. I wanted to find proof of what he based his dismissal on, so I went after it. I read it once, still didn't get it, read it a second time, Stripped all the legal mumbo jumbo away and read it like a novel. Bingo, I found the very part where Lamberth was wrong. He refers to powers the Director has and refers to unrestricted control. Yes, that is in there, in HERA.....but it is not for conservatorships, it is for receiverships. FnF were never in receivership, they were always in conservatorship only. Lamberth is very likely to be overturned on appeal. On the blog timhoward717.com, you can see the Perry Injunction Appeal Documents and see my analysis of the arguments the Perry lawyers presented, but missed the whole connection to the White Papers.

Please be aware that HERA is based on the Fed Housing Enterprises Financial Safety & Soundness Act of 1992. HERA modifies the Act of 1992 and HERA strengthens the Act of 1992. But NOWHERE in HERA or the ACT of 1992 is winding down FnF an acceptable outcome. Please, go read the acts and prove me wrong.