investors unite
<div style="font-size: small; background-color: rgb(255, 255, 255);"><font size="4" face="Times New Roman">=</font></div><div style="font-size: small; background-color: rgb(255, 255, 255);"><font size="4" face="Times New Roman">no links img</font></div><div style="font-size: small; background-color: rgb(255, 255, 255);"><font size="4" face="Times New Roman">
</font></div><div style="font-size: small; background-color: rgb(255, 255, 255);"><a href="http://www.huffingtonpost.com/entry/vulture-fund-lobbying_us_57350001e4b077d4d6f2a374" style="text-decoration: none; font-weight: bold; color: rgb(0, 51, 153); outline: none;"><font size="4" face="Times New Roman">http://www.huffingtonpost.com/entry/vulture-fund-lobbying_us_57350001e4b077d4d6f2a374</font></a></div><div style="font-size: small; background-color: rgb(255, 255, 255);"><font size="4" face="Times New Roman">
</font></div><div style="font-size: small; background-color: rgb(255, 255, 255);"><div><font size="4" face="Times New Roman">Harvard-trained political economist, Shapiro is the head of a consulting firm called Sonecon. That business card doesn’t do it for you? He’s got a few more in his wallet:</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">Senior fellow at the Georgetown University School of Business.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">Adviser to the International Monetary Fund.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">Director of the Globalization Initiative at NDN, a progressive think tank.</font></div><div><font size="4" face="Times New Roman">Shapiro, a Democrat, has advised presidents and presidential candidates, and has held powerful government posts. It stands to reason, then, that when he has thoughts on public policy, he can find an outlet ready to publish them.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">Recently, he’s had ideas on how the government can address the debt crisis in Puerto Rico and how it can end the conservatorship of Fannie Mae and Freddie Mac by moving them into the private market. Before that, he had a take on how to deal with Argentina’s debt crisis. For all three, he produced academic-looking papers, complete with footnotes and charts.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">All three situations have one thing in common: If they were resolved the way Shapiro suggested, a variety of bets placed by a select group of the most politically powerful hedge funds would pay off in a huge way. In the case of Argentina, they mostly have. Fights over how to resolve the other two issues are still raging in Washington.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">For this article, we called Shapiro to ask on whose behalf he has been waging these intellectual battles. His answer was surprising in its honesty: He’s working with DCI Group, a political dark arts master known to be advocating on behalf of a group of powerful hedge funds that are changing how Washington works.</font></div><div><font size="4" face="Times New Roman"><b>
</b></font></div><div><font size="4" face="Times New Roman"><b>Shapiro, it turns out, is but one foot soldier in the hedge fund infantry.</b> A review of public documents, tax filings and interviews with people involved finds that in each of the three campaigns, hedge funds have enlisted the same set of lobbyists, political operatives, dark money groups and think-tank experts spanning the political spectrum.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">No single document or set of disclosures ties all of these groups together. They don’t put out joint press releases, parade themselves around Washington as part of a coalition, or chat together on conference calls. Finding the players in this game, instead, is more a process of deduction. For a group of firms and experts to be working for vulture funds on the issue of Argentine debt is normal Washington practice. (Vulture’s meaning here isn’t pejorative: it refers to an investment strategy that feeds off of assets the market has left for dead.)</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">For the exact same people and groups to be working on the next big issue that these funds care about — the Puerto Rican debt crisis — could be a coincidence. But now, the hedge funds are focused on a third issue — government-sponsored enterprise reform, which refers to the effort to establish new housing finance policy in the wake of the federal takeover of lenders Fannie Mae and Freddie Mac. And it’s the same political firms and the same independent experts that are once again weighing in — coincidentally, all on the side of the hedge funds.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">Maybe it’s all coincidence, but let’s run the traps either way.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman" style="background-color: rgb(255, 255, 102);">The band that has gotten together for the big three hedge fund jam sessions includes some unlikely allies: There’s<b> DCI Group</b>, the powerhouse lobbying firm. Then there’s the<b> Raben Group, operatives whose specialty is working in the progressive space and lobbying Democrats</b>. There’s the American Continental Group, a bipartisan lobbying firm. There’s <b>60 Plus and the Center for Individual Freedom,</b> two groups that call themselves part of the conservative movement, but in reality are dark money groups known to run whatever campaign they’re paid to run, and that are happy to conceal the source of the funding. All these groups have roughly nothing in common, other than that they all have <b>united in advocacy campaigns that alternately go up against the Argentinian people, Puerto Ricans and the rest of the American public</b>.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman"><b>Each of these campaigns appears to have been run by or aided by the DCI Group</b>. We say “appears” because DCI is one of Washington’s great black boxes — news articles that involve DCI routinely include a line informing readers that the organization did not respond to a request for comment. This article is no different.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman"><b>Old Washington hands involved in these particular fights say that nothing they’ve seen before in politics has prepared them for the mercenary campaigns the hedge funds are now waging.</b></font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman" style="background-color: rgb(255, 255, 102);">“There’s something about this that’s almost more disturbing, because you get an issue that’s not particularly a big public issue and people can spend and spend and spend,” said a veteran policymaker who found himself on the wrong end of the hedge funds. “And I don’t know how anybody can compete with it. And then you start losing the narrative and you see groups on the left get bought out and corrupted — really corrupted. I don’t know what to do about it.”</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">What is being done only exacerbates the situation. Current tax policy allows hedge fund managers to pay billions less every year than competitors who don’t get the same advantage. And tax-exempt pension funds — teachers, nurses, firefighters — invest heavily in hedge funds, hoping to make up big shortfalls with risky investments. The generous tax policy leaves hedge funds flush with cash. What money they’re not stashing off shore, they’ve been spreading freely around Washington.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman" style="background-color: rgb(255, 255, 102);">They may have finally gone too far. A backlash is brewing, threatening not just their current bets, but their various tax benefits too. One senior House Republican aide who’s worked closely with the hedge funds says that members of Congress have seen enough. “I think on the Fannie stuff, they’ve hurt themselves,” he said. “We’re like, fuck em. If they’re not your friends, they’re your enemies.”</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman"><b>And the hedge funds may be losing a crucial progressive ally. Responding to concerns from the Hispanic advocacy community, the Raben Group dropped its work on Puerto Rico two weeks ago. </b></font></div><div><font size="4" face="Times New Roman">
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</b></font></div><div><font size="4" face="Times New Roman"><b>When big banks squared off against merchants such as Walmart in 2011 over the cost of debit card and credit card swipe fees, Washington saw a spending spree and a dirty campaign the likes of which it hasn’t seen since. But at least the arguments on both sides of the swipe fees issue made some rational sense.</b></font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">“This one, I feel just disgusted by it,” said one GOP Senate aide who witnessed both.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">With the hedge fund battles, a group of rich investors simply picks a side and then spends endlessly to tilt the battlefield to make sure that side wins. And in true Washington fashion, people are annoyed that the sellouts have sold low. As the same Senate GOP aide put it: “Sure, I’ll go after a few individuals, and help make Congress dysfunctional, so we can have Donald fucking Trump as our nominee, just so I can make $25,000. That’s just sad for our country.”</font></div><div><font size="4" face="Times New Roman">
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</font></div><div><font size="4" face="Times New Roman">JONATHAN ERNST / REUTERS</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman"><b>John Paulson, billionaire head of Paulson & Co.</b>, stands to make massive profits if lobbying campaigns on Puerto Rican debt and Fannie Mae and Freddie Mac go his way.</font></div><div><font size="4" face="Times New Roman">Not everybody sells out that cheaply. The Wall Street Journal on Thursday ran a piece on the hedge-fund lobbying around reform of government-sponsored entities, or GSEs.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">Last year, The Raben Group, a Washington lobbying firm, offered a minority trade association $25,000 contingent on the association signing its name to an editorial arguing that Fannie and Freddie should be recapitalized and returned to private hands, said Gary Acosta, chief executive of the National Association of Hispanic Real Estate Professionals.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">“They said, ‘If you won’t say exactly what you need to say, we’re not going to sponsor you,’” Mr. Acosta said. He said the association declined the offer.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">Raben Group founder Robert Raben said the firm frequently matches funding from corporations with nonprofits that share a position but doesn’t ask them to change their stance. He declined to disclose the source of the money offered to the association.</font></div><div><font size="4" face="Times New Roman">What makes the hedge fund pressure campaign distinctive is the ambivalence, or even nihilism, that lies behind the public policy suggestions. Hedge funds want whatever policy outcome will make their leveraged bet pay off. It makes gauging the merits of a particular policy extraordinarily difficult. The targets of the campaign are largely beside the point: It’s not personal, it’s just business. Hedge funder Bill Ackman’s very public lobbying and PR campaign against Herbalife serves as the clearest example of the influence strategy deployed by hedge funds. But in that case, Ackman was only taking on a single company, so the damage to potential bystanders was limited. The same playbook applied to entire countries, a commonwealth or the housing industry itself amplifies the threat exponentially.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">This one, I feel just disgusted by it.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">And it’s not ideological, either. If a big group of hedge funds decided to short the health insurance industry, it could easily be in their interests to fund a dark money campaign on behalf of single-payer health care. If they short the big banks, they’ve now become allies with Sen. Elizabeth Warren (D-Mass.).</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">It’s less far-fetched than it might seem. Today, billionaire hedge fund managers are working the halls of Congress with civil rights groups and affordable housing advocates. The progressive groups have long wanted any GSE reform to include big money to make housing more affordable for the working class. Now that the hedge funds are in the game, the groups suddenly have an additional demand: Make sure any final plan pays out the shareholders (i.e., the hedge funds) handsomely.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">The hedge funds bought a mountain of Fannie Mae stock after the government took it over and declared it worthless. The funds are trying to revive the share price by pressuring the government to let Fannie keep its profit and ultimately re-privatize the company. The alliance is understandable: For years, the progressive groups have been outmatched and out-funded, and along come some billionaires willing to back their effort. All these new advocates want is for their property rights to be protected. Why not?</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">“We knew we were getting in bed with people who wanted to see [Fannie Mae] pay them off,” Potomac Coalition founder Larry Parks told The Wall Street Journal for Thursday’s article. “It wasn’t anything we were so ideologically against.”</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman"><b>In Argentina</b>, things didn’t work out so well for the folks on the other side of the hedge funds. In 2002, Argentina bucked years of social pressure from the International Monetary Fund and defaulted on its debt. No longer would it have its public policy dictated by international lenders backed by what became known as the Washington consensus — the notion that the best way for countries to grow was to slash spending, privatize whatever they could, cut taxes and make way for business investment. After defaulting, <span style="background-color: rgb(255, 255, 102);">Argentina negotiated with lenders to resolve the debt, making deals with 93 percent of its creditors. A few American hedge funds held out, and waged a guerrilla campaign to recoup 100 percent of the value of their bonds, even though they bought them for pennies.</span></font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman" style="background-color: rgb(255, 255, 102);">It took 15 years, and a pressure campaign against Argentina that linked it to terrorism and other atrocities, but the hedge funds could eventually land a $5 billion-$10 billion payout. <b>It’s even reasonable to say the hedge funds helped bring down the Argentine government.</b> Along the way, they blew up the international system of credit, as negotiations between sovereign borrowers and their creditors are no longer possible without 100 percent buy-in from creditors.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman"><b>In Puerto Rico, the group of hedge funds waging the biggest lobbying campaign own debt that is first in line to be paid off in case of any calamity</b>. (That’s not to say there aren’t other hedge funds that own different sets of Puerto Rican debt lobbying so that they’re the first to be paid; more on them later.) They’re now betting that they can stop Congress from rescuing Puerto Rico by amending bankruptcy laws to allow Puerto Rico to cover its basic expenses before paying out the hedge funds.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">Betting that Congress does nothing is often a smart wager. If the island government is forced to pay off creditors first, it will have to take those funds from vital programs threatening the livelihoods of people who live there.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">In a trip to the commonwealth this week, Treasury Secretary Jack Lew emphasized the human impact that the hedge fund lobbying campaign is already having on Puerto Ricans. “The financial crisis is not just a question of bondholders, but a question of the lives that are being led by 3.5 million Americans who live on Puerto Rico,” Lew said during a visit to an elementary school in the heart of San Juan.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">The school, Eleanor Roosevelt Elementary, looked like something out of a Third World country. Children studied in crumbling classrooms with termite-ridden walls, no air conditioning, and inadequate lighting. The only source of cooling from the 80-degree weather outside was fans and open windows. The TVs, laptops, desktop computers all appeared pointless. Teachers said that if they tried to run more than one simultaneously with another classroom, the electricity would go out. Faulty circuit breakers also mean the classroom lights stay off whenever it rains, and since it was drizzling that day, the students sat in the dark.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">On the next stop, Lew saw Centro Medico, the primary medical center for the commonwealth and the Caribbean region, and home to the third-largest Level 1 trauma center in the U.S. and its territories. The center is preparing to reduce services by July if no relief comes. Already, a lack of personnel makes it nearly impossible to keep accurate supply inventory for children being treated for cancer or receiving dialysis. “We are hanging by a thread,” explained Dr. Juan Nazario, the hospital’s executive director.</font></div><div><font size="4" face="Times New Roman">
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</font></div><div><font size="4" face="Times New Roman">LAURA BARRON-LOPEZ</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">The walls in this kindergarten classroom at Eleanor Roosevelt Elementary in San Juan, Puerto Rico are crumbling due to termite infestation.</font></div><div><font size="4" face="Times New Roman">That’s not to say that there isn’t lobbying on the other side of these issues. An entirely different group of hedge funds and investment firms want relief for Puerto Rico so that the bonds that they’ve purchased will be paid in full. Legislation that they support has received the backing of House Speaker Paul Ryan (R-Wis.) and has moved through a favorable committee. On GSE reform, big banks like Bank of America and Citigroup have lobbied for legislation that would eliminate Fannie Mae and Freddie Mac and replace them with a system of government insurance for bank loans. The banks employ dozens of lobbyists, but do not appear to be engaging in the kind of surreptitious campaign the hedge funds are conducting on the other side.</font></div><div><font size="4" face="Times New Roman">
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</font></div><div><font size="4" face="Times New Roman" style="background-color: rgb(255, 255, 102);"><b>Corporate lobbying is often constrained by the need to play the long game.</b> Sometimes a company, or an entire industry, realizes it needs to take a loss today, but will be back tomorrow to fight again<b>. That can encourage corporate actors to rely more on carrots</b>: Campaign contributions and cushy jobs are in store for staffers and members of Congress who play nice.</font></div><div><font size="4" face="Times New Roman" style="background-color: rgb(255, 255, 102);">
</font></div><div><font size="4" face="Times New Roman" style="background-color: rgb(255, 255, 102);">But because the hedge funds are fighting over a different bet each time — Argentina today, Fannie and Freddie tomorrow — the most bang for the buck may come from a run of<b> negative TV ads in key congressional districts, or targeted campaigns against leading members of Congress on the wrong side.</b></font></div><div><font size="4" face="Times New Roman" style="background-color: rgb(255, 255, 102);">
</font></div><div><font size="4" face="Times New Roman" style="background-color: rgb(255, 255, 102);">Or even against <b>staffers</b>. In the midst of the debate over how to restructure Fannie Mae and Freddie Mac in early 2014, Jim Millstein was sitting down on Capitol Hill with Michael Bright, an aide to Sen. Bob Corker (R-Tenn.), who was working on the legislation. Millstein, like other hedge-fund titans lobbying on the bill, had a set of structural recommendations he thought the Senate should take up.</font></div><div><font size="4" face="Times New Roman" style="background-color: rgb(255, 255, 102);">
</font></div><div><font size="4" face="Times New Roman" style="background-color: rgb(255, 255, 102);">Millstein was worth listening to: While a top Treasury Department official, he had overseen the successful restructuring of AIG after the government bailout. But Millstein had an extra recommendation: The Fannie Mae shareholders needed to be paid out — shareholders like Millstein.</font></div><div><font size="4" face="Times New Roman" style="background-color: rgb(255, 255, 102);">
</font></div><div><font size="4" face="Times New Roman" style="background-color: rgb(255, 255, 102);">The aide told Millstein he didn’t see why shareholders, who bought Fannie stock for pennies when the government had already bailed it out, needed a windfall. The meeting turned tense.<b> “Don’t worry kid, you’re about to get yours,</b>” Millstein said, according to a Democratic committee staffer later briefed on the episode. Bright, reached for comment, declined to speak for this article.</font></div><div><font size="4" face="Times New Roman" style="background-color: rgb(255, 255, 102);">
</font></div><div><font size="4" face="Times New Roman"><b style="background-color: rgb(255, 255, 102);">A week or so later, the conservative Free Beacon dropped a story headlined, “Banker Who Helped Crash Housing Market Helped Crafting Mortgage Reform.”</b></font></div><div><font size="4" face="Times New Roman" style="background-color: rgb(255, 255, 102);">
</font></div><div><font size="4" face="Times New Roman" style="background-color: rgb(255, 255, 102);">The headline was absurd — Bright had been a low-level trader at Countrywide Financial Corp. right out of college, hardly in a position to blow up the housing market. But the facts didn’t matter. With the story in print, political operatives could now put the claim on the airwaves, and for cover source it back to the Free Beacon, a neat trick since the same operatives may well have been the ones who fed it to the Beacon. Two weeks later, the 60 Plus Association, a conservative dark money group, put out an attack ad repeating the allegation that “a former Countrywide financial executive is even helping craft the legislation.” The ad ran in North Carolina, Virginia and Idaho, targeting specific lawmakers involved in the legislation.</font></div><div><font size="4" face="Times New Roman"> </font></div><div><font size="4" face="Times New Roman" style="background-color: rgb(255, 255, 102);">The aggressive tactics appear to have included ethics complaints, too. Campaign for Accountability, a watchdog founded by former employees of <b>Citizens for Responsibility and Ethics in Washington</b>, filed complaints against Corker, the leading Republican sponsor of housing reform legislation with Sen. Mark Warner (D-Va.). The complaints, filed in November, allege Corker engaged in suspicious stock trades.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">The next month, Campaign for Accountability called for a Department of Justice probe of former Obama administration officials David Stevens, Michael Berman and Jim Parrott for allegedly breaking revolving-door laws banning them from lobbying their former offices. Stevens is the former Federal Housing Administration official under Obama who left to head the Mortgage Bankers Association. Berman and Parrott both worked at the Department of Housing and Urban Development as it shaped housing policy before leaving for the private sector.</font></div><div>
</div><div><font size="4" face="Times New Roman" style="background-color: rgb(255, 255, 102);">Sen. Bob Corker (R-Tenn.) was the leading Republican proponent of legislation to reform Fannie Mae and Freddie Mac that was opposed by the hedge funds.</font></div><div><font size="4" face="Times New Roman" style="background-color: rgb(255, 255, 102);">In February, National Legal and Policy Center, a conservative ethics watchdog group, filed a complaint against Stevens over the same revolving-door laws. Stevens is a leading proponent of the Warner-Corker legislation. </font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">Then, in March, Campaign for Accountability filed another complaint against Corker over omissions of large assets from his financial disclosure reports.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">It’s not possible to prove that hedge fund money is driving these complaints. But let’s work backward again. Campaign for Accountability is run by operatives from the group Citizens for Responsibility and Ethics in Washington, or CREW. Last year,<span style="background-color: rgb(255, 255, 102);"> CREW took $40,000 from Herbalife, which was under assault from hedge funder Ackman. CREW pushed back, filing an ethics complaint against Ackman. When the $40,000 donation came to light, CREW promised to return it, citing the appearance of a conflict of interest.</span></font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">CFA doesn’t release information on its donors. Former CREW honcho Melanie Sloan, who now does some work with CFA, said the group doesn’t take hedge fund money. But CFA itself might not even know if it takes hedge fund money: If a hedge fund gives to a foundation, which gives to a civil rights group, which then gives to CFA, it can be hard to track.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">Either way, the Raben Group immediately circulated the complaints against Corker and Stevens around Washington by email. People close to Corker said they believe the ethics complaints were motivated by the hedge fund lobbying campaign. (Of course, the complaints might also have merit; in fact, both things could be true at the same time.)</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">When he was on the Hill pushing for GSE reform, Millstein had company. Michael Waldorf, with Paulson & Co., has been in the Senate to lobby on the GSE bill, as has Chris Katopis of the Association of Mortgage Investors, and Shawn Smeallie of American Continental Group, which works for DCI and Paulson, according to congressional sources.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">Julie Chon, a former Democratic Banking Committee staffer, a top aide to Chairman Chris Dodd (D-Conn.), left the committee for Perry Capital Management, run by big-time Hillary Clinton donor Richard Perry. In early April, Chon organized a Clinton fundraiser that Senate banking staffers co-hosted. But at the height of the battle over Corker-Warner, she was a fixture on Capitol Hill — though she does not appear to have registered as a lobbyist.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">“She wasn’t even shy that she was advocating for a payout,” said one of the former colleagues Chon lobbied in the Senate. As she’d roam the Senate halls, she’d cheerily greet staffers with a line that is such a perfect combination of talking point, banality and sarcasm that it could have been written by the creators of HBO’s “Veep.” “Just here trying to defend our property rights,” she’d repeat.</font></div><div><font size="4" face="Times New Roman">
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</font></div><div><font size="4" face="Times New Roman">The American people, of course, are endowed by their creator with certain inalienable rights. Political hedge funds, though, aren’t leaving things in God’s hands alone. For that, there’s the DCI Group.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman"><b>The DCI Group most famously built its reputation doing the dirty work of the tobacco industry</b>. That long-running operation involved funding “experts” who would question the medical science around smoking, and targeting individual advocates and lawmakers. It pioneered the use of shadow groups that concealed the true source of funding for the campaign, and can be seen as a blueprint for the hedge fund campaigns.</font></div><div><font size="4" face="Times New Roman" style="background-color: rgb(255, 255, 102);">
</font></div><div><font size="4" face="Times New Roman" style="background-color: rgb(255, 255, 102);">According to the lobbying disclosure records that do exist, DCI Group hired the Raben Group, American Continental Group and others to lobby on the Puerto Rico issue. American Continental Group is Paulson’s personal lobby shop, and also has a political intelligence arm heavily active in Argentina. Political intelligence differs from traditional lobbying in that its practitioners are not required to register their activities (thanks Eric Cantor) and it is not focused on influencing policy, but rather on learning in advance about upcoming policy changes or investigations, so that companies or hedge funds can get a jump on trades and business decisions.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">DCI also ran a lobbying campaign against the Puerto Rican government on behalf of Doral Financial, a now-bankrupt Puerto Rican bank, and BlueMountain Capital. They brought Shapiro on board and hired <b>Liberty International Group, a lobbying firm of former Rep. Connie Mack (R-Fla.).</b></font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman" style="background-color: rgb(255, 255, 102);">Back in 2007, DCI was instrumental in killing legislation that would have regulated Fannie Mae and Freddie Mac, a doomed effort that may have prevented the lenders from melting down. It earned $2 million from Freddie Mac for its work.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman"><b>DCI was also part of American Task Force Argentina, the hedge-fund backed effort that battled Argentina over its default</b>. Raben Group’s Robert Raben and Shapiro led the task force, and Shapiro’s consulting firm was paid at least $450,000. While there are no public filings today, the group is helping run the Fannie hedge-fund operation, according to DCI managing partner Justin Peterson, who has privately talked about DCI’s work. Shapiro, too, said he was working with DCI for his housing policy work.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">All that work, even if it’s behind the scenes and unregistered, has to leave a trace. Here are two Facebook posts, one from late 2014 and another from early 2015, that have DCI organizing Fannie-related press events on the Hill for Investors Unite, a group of investors united to get a payout.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">FACEBOOK.COM</font></div><div><font size="4" face="Times New Roman">A Facebook post by Wirestream Media shows that <b>DCI Group is working with Investors Unite,</b> an investment fund backed group lobbying on Fannie Mae and Freddie Mac reform.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">FACEBOOK.COM</font></div><div><font size="4" face="Times New Roman">A second Facebook post by Wirestream Media shows DCI Group’s involvement with Investors Unite.</font></div><div><font size="4" face="Times New Roman"><b>
</b></font></div><div><font size="4" face="Times New Roman"><b>Former DCI lobbyist Douglas Davenport </b>is also on the hedge fund payroll, registered on behalf of both American Task Force Argentina and the Puerto Rican bondholders.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">The same lawyer has suited up for all three causes, too. Matthew McGill represents the hedge fund BlueMountain, which owns some $400 million worth of Puerto Rico debt. He successfully persuaded a judge to throw out a Puerto Rico law that stood in the way of the hedge funds. “Now we have a real negotiation where the bargaining power is essentially even,” McGill said afterward. BlueMountain also employed DCI Group in 2014 and 2015 on the Puerto Rico debt fight.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman"><b>McGill represents Perry Capital </b>in its shareholder lawsuit related to Fannie and Freddie. He participated in at least one PR event with Investors Unite, a Fannie-fighting group that DCI also represents.</font></div><div><font size="4" face="Times New Roman" style="background-color: rgb(255, 255, 102);">
</font></div><div><font size="4" face="Times New Roman"><span style="background-color: rgb(255, 255, 102);">And finally — or, firstly — McGill represented NML Capital, a subsidiary of Elliott Management,</span> the hedge fund connected with <b>GOP megadonor Paul Singer,</b> in the lawsuit against Argentina, along with Aurelius Capital Management. That lawsuit allowed the hedge funds to extract billions from the Argentinian people. It came after the years-long slash-and-burn campaign run from the <span style="background-color: rgb(255, 255, 102);"> American Task Force Argentina — a lobbying coalition of Covington & Burling, <b>DCI Group </b>and the Raben Group.</span></font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">Rob Shapiro, meanwhile, doesn’t appear on any lobbying reports or disclosures, but he was publicly attached to a pressure campaign that DCI Group ran on behalf of Doral Financial. The bank, which the Federal Deposit Insurance Corp. took into receivership on Feb. 27, 2015, was suing the island government over a disputed $229 million tax refund. A website DCI Group created — Doral Puerto Rico Facts — promoted Shapiro’s study on the island’s debt problems. But it wasn’t just the bank that wanted to get the money back. Its hedge fund creditors wanted to get paid.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">Who is paying who isn’t always easy to tell. Take the paper by Shapiro and Elaine Kamarck, touted as the independent views of officials from both the Obama and Clinton administrations, that comes to the conclusion that the hedge funds ought to be paid dollars for the shares of Fannie Mae they bought for pennies.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">Neither Shapiro nor Kamarck are housing finance analysts or experts. Kamarck isn’t even an economist — her work is in the field of political science, studying election and turnout trends. The paper itself offers a rather stunning giveaway: The three pillars of housing finance have long been Fannie Mae, Freddie Mac and Ginnie Mae. In the Shapiro-Kamarck paper, Ginnie Mae is twice referred to as “Ginny Mae.” Anybody can make a mistake. But nobody with a housing policy background would do that twice.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">“It would be like somebody claiming to be writing as a progressive journalist and calling it The Huffington Globe. It just gives away the game,” said one policymaker who read the paper.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">When we asked Shapiro who was funding his work on the GSEs, he said it “was sponsored by a low-income housing coalition.” The report thanks The Potomac Coalition, an African-American business and advocacy group. The Potomac Coalition’s Parks told The Wall Street Journal that his group indeed did pay for the paper, but that “Fannie and Freddie shareholders suggested the authors.” Parks added, in the Journal’s paraphrase, “the contents of the paper were drafted and negotiated by the authors, his group, shareholders and their lobbyists.”</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">Shapiro said he hasn’t been otherwise very active in the housing policy fight. “That’s all I did, and I haven’t taken any other role and I’m very proud of that analysis because it would provide more funding for low-income housing than any program in American history,” he said.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">But what about the Fix Fannie & Freddie website, which exists to promote the study?</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">“I don’t have a website about fix Fannie and Freddie,” Shapiro said. “It’s not my website. That’s not true.”</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">The website specifically says it is “sponsored by Sonecon,” which is Shapiro’s consulting firm. Just above that, it says, “About Dr. Shapiro.”</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">FIXFANNIEFREDDIE.COM</font></div><div><font size="4" face="Times New Roman">The top of the Fix Fannie & Freddie website promoting Dr. Robert Shapiro’s paper on the subject.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">FIXFANNIEFREDDIE.COM</font></div><div><font size="4" face="Times New Roman">The bottom of the Fix Fannie & Freddie website indicates it was sponsored by Dr. Robert Shapiro’s consulting firm Sonecon LLC. </font></div><div><font size="4" face="Times New Roman">Shapiro asked for the web address so he could check it out himself. But he was having a hard time finding it, so he read it back. “F-A-N-N-Y ...”</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">“No, F-A-N-N-I-E,” we told him, which unlocked his path to the site with his company’s name on it.</font></div><div><font size="4" face="Times New Roman">
</font></div><div><font size="4" face="Times New Roman">“Well, I will tell you it is not sponsored by me,” Shapiro said when he found it. He then added a new admission about the link to DCI. “But, I have worked with DCI on this. I’m not surprised that they’re promoting the study and myself and Dr. Kamarck.”</font></div></div><div style="font-size: small; background-color: rgb(255, 255, 255);"><font size="4" face="Times New Roman">
</font></div><div style="font-size: small; background-color: rgb(255, 255, 255);"><font size="4" face="Times New Roman">=</font></div><div style="font-size: small; background-color: rgb(255, 255, 255);"><font size="4" face="Times New Roman">offic bs page </font></div><div style="font-size: small; background-color: rgb(255, 255, 255);"><font size="4" face="Times New Roman">staffer ad attack:</font></div><div style="font-size: small; background-color: rgb(255, 255, 255);"><font size="4" face="Times New Roman">
</font></div><div style="background-color: rgb(255, 255, 255);"><font size="4" face="Times New Roman"><a href="http://investorsunite.org/category/headlines/page/5/">http://investorsunite.org/category/headlines/page/5/</a></font></div><div style="background-color: rgb(255, 255, 255);"><font size="4" face="Times New Roman">
</font></div><div><h2 id="post-272" style="margin: 5px 0px 15px; padding: 0px 0px 8px; border-width: 0px 0px 1px; border-bottom-style: solid; border-bottom-color: rgb(231, 231, 231); font-weight: inherit; font-stretch: inherit; line-height: inherit; vertical-align: baseline; background-color: rgb(255, 255, 255);"><a href="http://investorsunite.org/ex-countrywide-exec-co-wrote-mortgage-reform-bill/" style="margin: 0px; padding: 0px; border: 0px; font-style: inherit; font-variant: inherit; font-weight: inherit; font-stretch: inherit; line-height: inherit; vertical-align: baseline;"><font size="4" face="Times New Roman" color="#000000">Ex-Countrywide Exec Co-Wrote Mortgage Reform Bill</font></a></h2><font size="4" face="Times New Roman" style="background-color: rgb(255, 255, 255);"><span class="sep" style="margin: 0px; padding: 0px; border: 0px; font-stretch: inherit; line-height: 14.336px; vertical-align: baseline;">Posted </span><a href="http://investorsunite.org/ex-countrywide-exec-co-wrote-mortgage-reform-bill/" title="6:36 pm" rel="bookmark" style="margin: 0px; padding: 0px; border: 0px; font-stretch: inherit; line-height: 14.336px; vertical-align: baseline;"><time class="entry-date" datetime="2014-04-10T18:36:55+00:00" pubdate="" style="margin: 0px; padding: 0px; border: 0px; font-style: inherit; font-variant: inherit; font-weight: inherit; font-stretch: inherit; line-height: inherit; vertical-align: baseline;">April 10, 2014</time></a><span style="line-height: 14.336px;"> by </span><span class="byline author vcard" style="margin: 0px; padding: 0px; border: 0px; font-stretch: inherit; line-height: 14.336px; vertical-align: baseline;">Investors Unite</span><span style="line-height: 14.336px;" /></font><div class="entry" style="margin: 0px; padding: 0px; border: 0px; border-image-source: initial; border-image-slice: initial; border-image-width: initial; border-image-outset: initial; border-image-repeat: initial; font-stretch: inherit; line-height: 14.336px; vertical-align: baseline;"><p style="margin: 10px 0px; padding: 0px; border: 0px; border-image-source: initial; border-image-slice: initial; border-image-width: initial; border-image-outset: initial; border-image-repeat: initial; font-style: inherit; font-variant: inherit; font-weight: inherit; font-stretch: inherit; line-height: 1.6; vertical-align: baseline; background-color: rgb(255, 255, 255);"><em style="margin: 0px; padding: 0px; border: 0px; font-variant: inherit; font-weight: inherit; font-stretch: inherit; line-height: inherit; vertical-align: baseline;"><font size="4" face="Times New Roman">The Washington Free Beacon</font></em></p><p style="margin: 10px 0px; padding: 0px; border: 0px; border-image-source: initial; border-image-slice: initial; border-image-width: initial; border-image-outset: initial; border-image-repeat: initial; font-style: inherit; font-variant: inherit; font-weight: inherit; font-stretch: inherit; line-height: 1.6; vertical-align: baseline; background-color: rgb(255, 255, 255);"><font size="4" face="Times New Roman">April 10, 2014
By Alana Goodman</font></p><p style="margin: 10px 0px; padding: 0px; border: 0px; border-image-source: initial; border-image-slice: initial; border-image-width: initial; border-image-outset: initial; border-image-repeat: initial; font-style: inherit; font-variant: inherit; font-weight: inherit; font-stretch: inherit; line-height: 1.6; vertical-align: baseline; background-color: rgb(255, 255, 255);"><font size="4" face="Times New Roman">Controversial housing finance reform legislation making its way through the Senate Banking Committee was co-written by a former mortgage trader for Countrywide Financial and Wachovia, two of the subprime mortgage behemoths at the center of the housing market crash in 2007.</font></p><p style="margin: 10px 0px; padding: 0px; border: 0px; border-image-source: initial; border-image-slice: initial; border-image-width: initial; border-image-outset: initial; border-image-repeat: initial; font-style: inherit; font-variant: inherit; font-stretch: inherit; line-height: 1.6; vertical-align: baseline; background-color: rgb(255, 255, 255);"><font size="4" face="Times New Roman"><b>Michael Bright, the senior financial adviser [a staffer , not private investment guy] to Sen. Bob Corker (R., Tenn.), worked as a trader and member of the loan-pricing desk at Countrywide Financial from 2002 to 2006, and as a senior trader for Wachovia from 2006 to 2008.</b></font></p><p style="margin: 10px 0px; padding: 0px; border: 0px; border-image-source: initial; border-image-slice: initial; border-image-width: initial; border-image-outset: initial; border-image-repeat: initial; font-style: inherit; font-variant: inherit; font-weight: inherit; font-stretch: inherit; line-height: 1.6; vertical-align: baseline; background-color: rgb(255, 255, 255);"><font size="4" face="Times New Roman">Bright joined Corker’s office in 2010, and has been a key figure in crafting the Corker-Warner housing reform bill and the successive legislation spearheaded by Sens. Mike Crapo (R., Idaho) and Tim Johnson (D., S.D.).</font></p><p style="margin: 10px 0px; padding: 0px; border: 0px; border-image-source: initial; border-image-slice: initial; border-image-width: initial; border-image-outset: initial; border-image-repeat: initial; font-style: inherit; font-variant: inherit; font-weight: inherit; font-stretch: inherit; line-height: 1.6; vertical-align: baseline;"><font size="4" face="Times New Roman" style="background-color: rgb(255, 255, 102);">“[Bright’s] running the show,” said Tim Pagliara, a top bundler for Corker who has taken an active stance against the bill. “And Corker listens to him.”</font></p><p style="margin: 10px 0px; padding: 0px; border: 0px; border-image-source: initial; border-image-slice: initial; border-image-width: initial; border-image-outset: initial; border-image-repeat: initial; font-style: inherit; font-variant: inherit; font-weight: inherit; font-stretch: inherit; line-height: 1.6; vertical-align: baseline; background-color: rgb(255, 255, 255);"><font size="4" face="Times New Roman">View full article: http://freebeacon.com/politics/banker-who-helped-crash-housing-market-helped-crafting-mortgage-reform/</font></p></div></div><div style="background-color: rgb(255, 255, 255);">
</div><div style="background-color: rgb(255, 255, 255);">text grab:</div><div style="background-color: rgb(255, 255, 255);"><div></div><div>Investors Unite</div><div>FANNIEFREDDIESECRETS.ORGDONATE</div><div>Facebook</div><div>Twitter</div><div>Youtube</div><div> </div><div>Search …</div><div> SEARCH</div><div>HOME</div><div>ABOUT US</div><div>THE ISSUES</div><div>EVENTS</div><div>HEADLINES</div><div>RESOURCES</div><div>TAKE ACTION</div><div>Archive for the ‘Headlines’ Category</div><div>
</div><div>« Older Entries</div><div>Newer Entries »</div><div>Treasury Begins Push to Revive U.S. Mortgage-Bond Market</div><div>
</div><div>Posted June 26, 2014 by Investors Unite</div><div>Bloomberg </div><div>
</div><div>June 26, 2014, By Clea Benson</div><div>
</div><div>The Treasury Department will launch an initiative to revive the market for mortgage securities without government backing, a Treasury official said.</div><div>
</div><div>Treasury Secretary Jacob J. Lew will direct senior staff to bring together institutional investors and issuers of mortgage bonds to develop guidelines to reassure both sides that they won’t be saddled with unfair losses, said the official, who spoke on condition of anonymity to discuss an initiative that hasn’t been announced.</div><div>
</div><div>Read Full Article: Treasury Begins Push to Revive U.S. Mortgage-Bond Market</div><div>
</div><div>Treasury Secretary Unveils Small Steps to Augment Loan Modification Program</div><div>
</div><div>Posted June 26, 2014 by Investors Unite</div><div>New York Times</div><div>
</div><div>June 26, 2014</div><div>
</div><div>The Obama administration will take further steps to ease foreclosures, rising rents and scarce mortgages, Jacob J. Lew, the Treasury secretary, said on Thursday at a conference observing the fifth anniversary of Making Home Affordable, a suite of federal programs aimed at helping homeowners after the financial crisis.</div><div>
</div><div>Mr. Lew’s announcement came on the heels of a new wave of criticism — occasioned by the publication of a memoir by his predecessor, Timothy F. Geithner — that Treasury’s efforts to help homeowners were inadequate. (Salon’s take: “This man made millions suffer: Tim Geithner’s sorry legacy on housing.”)</div><div>
</div><div>Read Full Article: Treasury Secretary Unveils Small Steps to Augment Loan Modification Program</div><div>
</div><div>Fannie Mae chief economist says this is the biggest problem for the economy</div><div>
</div><div>Posted June 25, 2014 by Investors Unite</div><div>Yahoo! Finance</div><div>
</div><div> June 25, 2014, By Bernice Napach</div><div>
</div><div>It’s not uncommon for the U.S. economy to slow down five years into an economic recovery, but the sharp downward revision of first quarter GDP announced today was a shocker. The economy shrank by 2.9% — nearly three times the 1% decline reported previously and nearly twice the decline that economists had expected.</div><div>
</div><div>“It was well below our expectations,” says Doug Duncan, chief economist of Fannie Mae, about the latest GDP report. “We had expected [first quarter GDP] would be down 1.5-2%.”</div><div>
</div><div>Read Full Article: Fannie Mae chief economist says this is the biggest problem for the economy</div><div>
</div><div>Treasury to make ‘symbolic’ changes to home-affordability programs, analyst says</div><div>
</div><div>Posted June 25, 2014 by Investors Unite</div><div>MarketWatch</div><div>
</div><div>June 25, 2014, By Ruth Mantell</div><div>
</div><div>The Obama administration is set to announce changes to its home-affordability initiatives, but the updates are likely to be “narrowly targeted and largely symbolic,” an analyst says.</div><div>
</div><div>U.S. Treasury Secretary Jacob Lew is scheduled to make closing remarks Thursday afternoon at a housing summit in Washington, focusing on new policies to help struggling homeowners, increase affordable housing and expand credit access. But the timing of Lew’s announcement likely means that the administration’s new efforts may not impact many borrowers, wrote Isaac Boltansky, an analyst at Compass Point Research & Trading, a Washington-based investment firm.</div><div>
</div><div>Read Full Article: Treasury to make ‘symbolic’ changes to home-affordability programs, analyst says</div><div>
</div><div>Senate committee endorses Julián Castro as HUD Sec</div><div>
</div><div>Posted June 25, 2014 by Investors Unite</div><div>Housing Wire</div><div>
</div><div>June 25, 2014, By Trey Garrison</div><div>
</div><div>The Senate Banking Committee on Wednesday voted on a largely party line basis to endorse San Antonio Mayor Julián Castro to lead the Department of Housing and Urban Development.</div><div>
</div><div>The 16-6 vote – 12 Democrats and four Republicans approved – clears the way for a final vote in the full Senate.</div><div>
</div><div>Castro will take over HUD in the waning months of the Obama administration, if he is approved by the full Senate.</div><div>
</div><div>While Castro would be in place to execute whatever plan the White House has to wind down Fannie Mae and Freddie Mac, it is unlikely he will do so – GSE reform is pretty much dead until after the mid-term elections and likely dead until after the 2016 presidential election.</div><div>
</div><div>Read Full Article: Senate committee endorses Julián Castro as HUD Sec</div><div>
</div><div>Treasury to make ‘symbolic’ changes to home-affordability programs, analyst says</div><div>
</div><div>Posted June 25, 2014 by Investors Unite</div><div>MarketWatch</div><div>
</div><div>June 25, 2014, By Ruth Mantell</div><div>
</div><div>The Obama administration is set to announce changes to its home-affordability initiatives, but the updates are likely to be “narrowly targeted and largely symbolic,” an analyst says.</div><div>
</div><div>U.S. Treasury Secretary Jacob Lew is scheduled to make closing remarks Thursday afternoon at a housing summit in Washington, focusing on new policies to help struggling homeowners, increase affordable housing and expand credit access. But the timing of Lew’s announcement likely means that the administration’s new efforts may not impact many borrowers, wrote Isaac Boltansky, an analyst at Compass Point Research & Trading, a Washington-based investment firm.</div><div>
</div><div>Read Full Article: Treasury to make ‘symbolic’ changes to home-affordability programs, analyst says</div><div>
</div><div>Treasury Secretary testifies on GSEs, nonbank MSRs and TBTF</div><div>
</div><div>Posted June 24, 2014 by Investors Unite</div><div>Housing Wire</div><div>
</div><div>June 24, 2014, By Trey Garrison</div><div>
</div><div>It was a raucous and heated session at the House Financial Services Committee Tuesday morning as Treasury Secretary Jacob Lew made his annual report on the Financial Stability Oversight Council.</div><div>
</div><div>Perhaps not as fiery as Monday’s hearing on the IRS scandal and the unbelievable claims by the embattled IRS commissioner about the cover up of lost emails, but heated nonetheless.</div><div>
</div><div>In fact the issue of the IRS’s lost emails came up repeatedly, as the Treasury secretary was drawn into the investigation of the IRS commissioner and the IRS’s role in targeting political opponents of the White House.</div><div>
</div><div>GSE reform and the issue of some firms being “too big to fail” also led the discussion Tuesday morning.</div><div>
</div><div>Read Full Article: Treasury Secretary testifies on GSEs, nonbank MSRs and TBTF</div><div>
</div><div>Fannie Mae and Freddie Mac: Then and Now</div><div>
</div><div>Posted June 24, 2014 by Investors Unite</div><div>Daily Finance</div><div>
</div><div>June 24, 2014, By Wayne Duggan</div><div>
</div><div>I recently wrote an article in which I analyzed insurance giant AIG. There was something about telling the story of AIG that gave me a sense of nostalgia for the good ole days of 2008 and 2009 when the economy was in a tailspin, the Dow Jones was in the process of plummeting 50%, big banks were failing left and right, and the U.S. government was dishing out hundreds of billions of dollars of bailouts.You know, the good ole days?</div><div>
</div><div>Since I couldn’t shake the warm fuzzy feeling I got from my AIG analysis, I decided to take a “where are they now?” look at another couple of companies that found themselves at the epicenter of the financial crisis: Fannie Mae and Freddie Mac .</div><div>
</div><div>Read Full Article: Fannie Mae and Freddie Mac: Then and Now</div><div>
</div><div> </div><div>
</div><div>Fannie Mae, Freddie Mac shareholders deserve compensation</div><div>
</div><div>Posted June 24, 2014 by Investors Unite</div><div>The Idaho Statesman</div><div>
</div><div>June 24, 2014</div><div>
</div><div>I strongly commend Sen. Mike Crapo for proposing a housing finance reform bill that attempts to fix our broken housing finance system through a common-sense approach that would create a greater role for private capital in this sector.</div><div>
</div><div>It isn’t perfect, and there is room for debate on whether it adequately reduces the role of government while increasing that of the private sector, but it represents an excellent starting point. What the bill doesn’t address, however, is the question of whether shareholders of the government-sponsored entities Fannie Mae and Freddie Mac should be compensated.</div><div>
</div><div>Read Full Article: Fannie Mae, Freddie Mac shareholders deserve compensation</div><div>
</div><div>Does Johnson back Wall Street taking over U.S.?</div><div>
</div><div>Posted June 23, 2014 by Investors Unite</div><div>Argus Leader</div><div>
</div><div>June 23, 2014, By Harry Baltzer</div><div>
</div><div>According to the June 1 issue of the bimonthly magazine Progressive Populist, in an article by Dean Baker, our Sen. Tim Johnson and a cohort, Sen. Mike Crapo, R-Idaho, are introducing legislation to privatize Fannie Mae and Freddie Mac so that Wall Street banks won’t have to compete with them anymore.</div><div>
</div><div>I personally don’t pretend to understand the implications of that move, but apparently Baker, the writer of the article, does.</div><div>
</div><div>Because of his friendliness toward mega banks, I look for Johnson to be appointed to a lucrative board of directors position where he is expected to only give his approval to continued Wall Street takeover of our country.</div><div>
</div><div>Read Full Article: Does Johnson back Wall Street taking over U.S.?</div><div>
</div><div>Say no to Johnson-Crapo housing reform</div><div>
</div><div>Posted June 23, 2014 by Investors Unite</div><div>Daily Inter Lake</div><div>
</div><div>June 23, 2013</div><div>
</div><div>This special-interest piece of legislation makes big banks more powerful and winds-down Fannie Mae and Freddie Mac.</div><div>
</div><div>Fannie Mae was created 80 years ago after the Great Depression. Its purpose was to free up capital for affordable mortgages, thereby enabling citizens to live the American Dream of home ownership. Fannie Mae and her younger cousin Freddie Mac are GSEs, government sponsored entities. They are publicly traded, privately owned corporations that work closely with the government to support the housing market (20 percent of the U.S. economy).</div><div>
</div><div>Read Full Article: Say no to Johnson-Crapo housing reform</div><div>
</div><div>Fannie Mae, Freddie Mac: Fairholme Vs United States</div><div>
</div><div>Posted June 23, 2014 by Investors Unite</div><div>Value Walk </div><div>
</div><div>June 23, 2014</div><div>
</div><div>We have been posting some of the court documents in the Fannie Mae saga. Below is a new one we found in one of the cases between Fairholme and FHFA/Treasury.</div><div>
</div><div>Our motion for protective order and supporting declarations demonstrate that the discovery sought by plaintiffs would interfere with the functioning of the conservatorships of Fannie Mae / Federal National Mortgage Assctn Fnni Me (OTCBB:FNMA) and Freddie Mac / Federal Home Loan Mortgage Corp (OTCBB:FMCC), impair ongoing deliberations about the future of the Enterprises, and go far beyond the limited discovery contemplated by the Court’s February 26 order.</div><div>
</div><div>Read Full Article: Fannie Mae, Freddie Mac: Fairholme Vs United States</div><div>
</div><div>ABA Renews Freddie’s Alliance; Agency & Non-Agency Lawsuit News; Analyst Digs at Stonegate</div><div>
</div><div>Posted June 23, 2014 by Investors Unite</div><div>Mortgage News Daily </div><div>
</div><div>June 23, 2014, By Rob Chrisman</div><div>
</div><div>“On Thursday, June 19, issues of latency and connectivity were reported by the public across multiple Internet Service Providers. The public can observe trends in reports of issues with various major Internet Service Providers at sites like ‘downdetector.com’. Today – Friday, June 20, we are observing that the issues of yesterday are resolved as reported by the public at sites like ‘downdetector.com’.” It is a clever site to see if anyone is reporting internet problems. Of course, many vendors have their own sites such as the Ellie Mae Status Center.</div><div>
</div><div>Read Full Article: ABA Renews Freddie’s Alliance; Agency & Non-Agency Lawsuit News; Analyst Digs at Stonegate</div><div>
</div><div>U.S. housing recovery beginning to falter, according to industry experts</div><div>
</div><div>Posted June 22, 2014 by Investors Unite</div><div>The State Column</div><div>
</div><div>June 22, 2014, By David Keup</div><div>
</div><div>According to home buying industry experts, the two-year-old U.S. housing recovery is faltering.</div><div>
</div><div>Bloomberg News and the St. Louis Post-Dispatch reported on June 21 that the Mortgage Bankers Association (MBA) lowered its forecast for combined new and existing home sales in 2014 to 5.28 million on June 19. This would represent a decline of 4.1 percent from last year and would be the first annual drop in four years.</div><div>
</div><div>Read Full Article: U.S. housing recovery beginning to falter, according to industry experts</div><div>
</div><div>Fannie Mae, Freddie Mac Court Hearings – Transcript</div><div>
</div><div>Posted June 20, 2014 by Investors Unite</div><div>Value Walk</div><div>
</div><div>June 20, 2014</div><div>
</div><div>Below are some snippets from the recent hearing on Fannie Mae / Federal National Mortgage Assctn Fnni Me (OTCBB:FNMA). At the end is the entire transcript. Sweeney is clearly leaning towards the plaintiff’s arguments in discovery. What I expect is that discovery will be granted on a wider range of topics than the gov’t wants but that it will be range bound, initially. As discovery is done and as additional issues arise, I see Sweeney then broadening the scope of discovery. As she said, she is going to “do it in waves”.</div><div>
</div><div>Read Full Article: Fannie Mae, Freddie Mac Court Hearings – Transcript</div><div>
</div><div>GSE Investor Group Wants FHFA to Hike G-Fees</div><div>
</div><div>Posted June 19, 2014 by Investors Unite</div><div>Inside Mortgage Finance</div><div>
</div><div>June 19, 2014, By Charles Wisniowski</div><div>
</div><div>A coalition of investors in Fannie Mae and Freddie Mac stock wants the Federal Housing Finance Agency to increase the guaranty fees that the two charge their seller-servicers, a position that lenders won’t be too thrilled with.</div><div>
</div><div>In a comment letter to FHFA Director Mel Watt, Investors Unite Executive Director Tim Pagliara urged the agency to take into account “the critical purpose of setting appropriate guaranty fees,” noting that the Finance Agency does not have a mandate (as conservator) to manage Fannie and Freddie as not-for-profits. Pagliara is also chairman and CEO of CapWealth Advisors.</div><div>
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</div><div>Read Full Article: GSE Investor Group Wants FHFA to Hike G-Fees </div><div>
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</div><div>Fannie Mae, Freddie Mac: OCED Weighs In On Crapo-Johnson</div><div>
</div><div>Posted June 19, 2014 by Investors Unite</div><div>Value Walk</div><div>
</div><div>June 19, 2014, By Michael Ide</div><div>
</div><div> In its recent annual survey on member nations’ economies, the Organization for Economic Cooperation and Development (OECD) briefly weighed in on Fannie Mae / Federal National Mortgage Assctn Fnni Me (OTCBB:FNMA) and Freddie Mac / Federal Home Loan Mortgage Corp (OTCBB:FMCC) reform, recommending that the US government reduce its involvement in the secondary mortgage market and noting that the Crapo-Johnson proposal would make an explicit government guarantee that is almost unheard of among OECD nations.</div><div>
</div><div>Read Full Article: Fannie Mae, Freddie Mac: OCED Weighs In On Crapo-Johnson</div><div>
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</div><div>Cantor’s Loss is Warning Shot to Cronyism and Johnson-Crapo Supporters</div><div>
</div><div>Posted June 19, 2014 by Investors Unite</div><div>Newsmax</div><div>
</div><div>June 18, 2014, By John Berlau</div><div>
</div><div>Defying conventional wisdom as he often does, Pulitzer Prize-winning pundit (and fellow Newsmax Insider) George F. Will disputed the notion that in the wake of the shocking primary loss of House Majority Leader Eric Cantor, R-Va., even less in Congress will get done.</div><div>
</div><div>“I’ll tell you something that may get done now because of this and that is deauthorizing — refusing to reauthorize — the Export-Import Bank,” Will said on “Fox News Sunday.”</div><div>
</div><div>Read Full Article: Cantor’s Loss is Warning Shot to Cronyism and Johnson-Crapo Supporters</div><div>
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</div><div>What Is the Federal Government Hiding About Fannie Mae and Freddie Mac?</div><div>
</div><div>Posted June 19, 2014 by Investors Unite</div><div>Real Clear Markets</div><div>
</div><div>June 19, 2014, By Richard Epstein</div><div>
</div><div>At present the United States is embroiled in litigation with Fairholme Funds over the so-called Third Amendment to the Senior Preferred Stock Purchase Agreement (SPSPA) that it entered into on August 17, 2012. It did so through the Federal Housing Finance Authority (FHFA); the latter in its role as conservator of both Fannie Mae and Freddie Mac. At issue in that and other cases is the full dividend sweep, whereby FHFA agreed to hand over to the United States Treasury all of its net earnings, forever, so that the underlying advances could never be re-paid, no matter the future condition of Fannie and Freddie.</div><div>
</div><div>Read Full Article: What Is the Federal Government Hiding About Fannie Mae and Freddie Mac?</div><div>
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</div><div>Fannie-Freddie Shareholder Coalition Responds to the Federal Housing Finance Agency (FHFA) Request for Input on Proposed Increased Guarantee Fees</div><div>
</div><div>Posted June 18, 2014 by Investors Unite</div><div>June 18, 2014</div><div>FOR IMMEDIATE RELEASE</div><div>
</div><div>Contact: media@investorsunite.org</div><div>
</div><div>Fannie-Freddie Shareholder Coalition Responds to the Federal Housing Finance Agency (FHFA) Request for Input on Proposed Increased Guarantee Fees</div><div>
</div><div>Coalition Raises Concern Over 100% of Profits Directed Away From Housing Market, To Deficit Reduction</div><div>
</div><div>NASHVILLE, TN – Today, Investors Unite Executive Director Tim Pagliara filed a response to the Federal Housing Finance Agency’s (FHFA) request for input on the proposed increase to guarantee fees (g-fees) that Fannie Mae and Freddie Mac charge lenders. On behalf of Fannie and Freddie shareholders, Mr. Pagliara encouraged FHFA Director Mel Watt to consider the new proposed policy in context of the Treasury Department’s 100 percent net worth sweep of the enterprises. </div><div>
</div><div>“As long as Treasury is taking all of Fannie and Freddie’s profits, any increase in g-fees would amount to nothing more than a new tax applied to general deficit reduction, ” Pagliara said. “Ultimately, profits accumulated from g-fees and other business of Fannie and Freddie should be allowed to stay within the housing market and should be set at levels that help ensure safety and soundness of the GSEs, that protect long-term health of the housing market, and that respect the rights of all economic stakeholders-including the GSE’s shareholders.”</div><div>
</div><div>Pagliara also submitted to FHFA a recommended set of principles that should be considered for g-fees following reversal of the 2012 net worth sweep. They are as follows:</div><div>
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</div><div>Fannie Mae and Freddie Mac have profit-making purposes onto which public mandates are layered, and they should charge guarantee fees that earn an appropriate market-based return on the capital employed, whether taxpayer capital or private capital. This is an absolutely critical factor “other than expected losses, unexpected losses and G&A fees” that should be considered when determining g-fees.</div><div>Increasing guarantee fees will provide more cash flow with which the GSEs can build capital and be restored to “safe and solvent condition.” Maximizing returns is not only consistent with, but arguably required by, the conservatorship.</div><div>FHFA as conservator has legal duties to the direct economic stakeholders – including all shareholders – that must be respected alongside the interests of other parties.</div><div>Earning an appropriate return on capital is entirely consistent with the conservatorship and affordable housing mandates. There is no conflict here between the GSEs building capital and setting aside funds for affordable housing. Indeed, it is only when the GSEs have earned their way back to a “safe and solvent condition” that they can sustainably meet their public affordable-housing mandates. After the GSEs have adequate capital, the suspension of those mandates can be reversed, i.e. the affordable housing support can be turned back on.</div><div>Keeping guarantee fees low to support the housing market in general, including homeowners and homebuyers that are well off and do not need help, is not as important as charging higher guarantee fees (a) to build a capital base to protect against future credit losses, and (b) to redistribute a portion of earnings to targeted constituencies that particularly need financial support.</div><div>Guarantee fee rates should be tied to sound underwriting standards. If FHFA directs the GSEs to relax underwriting standards, it is essential that guarantee fees be adjusted upwards to account for the greater credit risk assumed in doing so.</div><div> </div><div>
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</div><div>About Investors Unite: Formed by Tennessee activist investor and CapWealth Advisors Chairman and CEO, Tim Pagliara, Investors Unite (www.investorsunite.org) is a coalition of private investors from all walks of life, committed to the preservation of shareholder rights for all invested in Fannie Mae and Freddie Mac. The coalition works to educate shareholders and lawmakers on the importance of adopting GSE reform that fully respects the legal rights of Fannie Mae and Freddie Mac shareholders and offers full restitution on investments. </div><div>
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</div><div>P.O. Box 2591</div><div>Brentwood, TN 37024</div><div>
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</div><div>Congress wants to know HUD won’t be ‘just a steppingstone’ for rising star Julian Castro</div><div>
</div><div>Posted June 18, 2014 by Investors Unite</div><div>Washington Post</div><div>
</div><div>June 17, 2014, By Dina Elboghdady</div><div>
</div><div>San Antonio Mayor Julian Castro addressed for the first time Tuesday some of the major housing policy issues likely to consume his time if he’s approved as head of the Department of Housing and Urban Affairs, fielding questions from a Senate panel that’s expected to give him the thumbs-up possibly later this month.</div><div>
</div><div>Castro is perhaps best known for delivering the keynote address at the 2012 Democratic National Convention and for his status as one the Democratic Party’s rising Latino stars — along with his identical twin brother, Joaquin, a congressman representing a San Antonio area district. Julian Castro’s name has come up more than once for high-profile Washington positions, including a possible vice presidential run in 2016.</div><div>
</div><div>Read Full Article: Congress wants to know HUD won’t be ‘just a steppingstone’ for rising star Julian Castro</div><div>
</div><div>Letter from Tim Pagliara to FHFA Director Mel Watt</div><div>
</div><div>Posted June 18, 2014 by Investors Unite</div><div>Investors Unite G-Fee Comments to Watt</div><div>
</div><div>Watt faces tough affordable housing question</div><div>
</div><div>Posted June 17, 2014 by Investors Unite</div><div>PoliticoPro</div><div>
</div><div> June 16, 2014, By Jon Prior</div><div>
</div><div>Fannie Mae and Freddie Mac regulator Mel Watt will soon have to dive into the politically thorny debate over affordable housing, an issue that served as one of the key breaking points in recent Senate talks over what to do with the two mortgage finance giants.</div><div>
</div><div>The affordable housing goals for government controlled Fannie and Freddie, last set by the Federal Housing Finance Agency in 2012, will expire at the end of the year, and homeowner advocates expect a proposal from Watt, who heads the agency, to come in July at the latest in order to allow time for public comment before it goes into effect next year.</div><div>
</div><div>Read Full Article: Watt faces tough affordable housing question </div><div>
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</div><div>Fannie Mae, Freddie Mac 2013 One-Time Event – FHFA</div><div>
</div><div>Posted June 17, 2014 by Investors Unite</div><div>Value Walk</div><div>
</div><div>June 17, 2014</div><div>
</div><div>The Federal Housing Finance Agency in its 2013 report to Congress points out Fannie Mae / Federal National Mortgage Association (OTCBB:FNMA) and Freddie Mac / Federal Home Loan Mortgage Corp (OTCBB:FMCC)’s record net income in 2013 are greater than at any prior time in their respective histories and these record income were driven largely by certain unique and very large benefits to income.</div><div>
</div><div>Read Full Article: Fannie Mae, Freddie Mac 2013 One-Time Event – FHFA</div><div>
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</div><div>FHFA Seeks Public Input on Proposed GSE Guaranty Fee Hikes</div><div>
</div><div>Posted June 16, 2014 by Investors Unite</div><div>Inside Mortgage Finance</div><div>
</div><div> June 13, 2014, By Charles Wisniowski</div><div>
</div><div>After months of anticipation, the Federal Housing Finance Agency last week issued an official call for public comment, particularly from the mortgage industry, on how Fannie Mae’s and Freddie Mac’s conservator should calculate both guaranty fees and loan-level price adjustments.</div><div>
</div><div>Read Full Article: FHFA Seeks Public Input on Proposed GSE Guaranty Fee Hikes</div><div>
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</div><div>Watt faces tough affordable housing question</div><div>
</div><div>Posted June 16, 2014 by Investors Unite</div><div>PoliticoPro</div><div>
</div><div>June 16, 2014, By Jon Prior</div><div>
</div><div>Fannie Mae and Freddie Mac regulator Mel Watt will soon have to dive into the politically thorny debate over affordable housing, an issue that served as one of the key breaking points in recent Senate talks over what to do with the two mortgage finance giants.</div><div>
</div><div>The affordable housing goals for government controlled Fannie and Freddie, last set by the Federal Housing Finance Agency in 2012, will expire at the end of the year, and homeowner advocates expect a proposal from Watt, who heads the agency, to come in July at the latest in order to allow time for public comment before it goes into effect next year.</div><div>
</div><div>Read Full Article: Watt faces tough affordable housing question </div><div>
</div><div>Fannie Mae Has Adequate Capital To Be Released From Conservatorship</div><div>
</div><div>Posted June 13, 2014 by Investors Unite</div><div>Seeking Alpha</div><div>
</div><div>June 13, 2014, By David Sims</div><div>
</div><div>Sometimes things are happening just because that’s the way that they’ve been happening for awhile. This is one of those times. Sometimes, things can be done to make things better if people only knew. For those who know, it is time to show and tell. For without the pursuit of the truth, there can be no expectation of achievement.</div><div>
</div><div>There are many people saying many things supporting various perspectives regarding the two private companies Fannie Mae (OTCQB:FNMA) and Freddie Mac (OTCQB:FMCC). Much like a political football, it’s really difficult to boil off the nonsense from the discussion to get it down to what are really the key points. We understand. As an associate of Glen’s remarked earlier, “I could read this stuff until I’m blue in the face and I still wouldn’t be qualified to have an informed opinion.”</div><div>
</div><div>Read Full Article: Fannie Mae Has Adequate Capital To Be Released From Conservatorship</div><div>
</div><div>Fannie Mae Has Adequate Capital To Be Released From Conservatorship</div><div>
</div><div>Posted June 13, 2014 by Investors Unite</div><div>Seeking Alpha </div><div>
</div><div>Friday, June 13, 2014, By David Sims </div><div>
</div><div>Sometimes things are happening just because that’s the way that they’ve been happening for awhile. This is one of those times. Sometimes, things can be done to make things better if people only knew. For those who know, it is time to show and tell. For without the pursuit of the truth, there can be no expectation of achievement.</div><div>
</div><div>There are many people saying many things supporting various perspectives regarding the two private companies Fannie Mae (OTCQB:FNMA) and Freddie Mac (OTCQB:FMCC). Much like a political football, it’s really difficult to boil off the nonsense from the discussion to get it down to what are really the key points. We understand. As an associate of Glen’s remarked earlier, “I could read this stuff until I’m blue in the face and I still wouldn’t be qualified to have an informed opinion.”</div><div>
</div><div>Read Full Article: Fannie Mae Has Adequate Capital To Be Released From Conservatorship </div><div>
</div><div>To Fix or Not to Fix Fannie Mae and Freddie Mac</div><div>
</div><div>Posted June 13, 2014 by Investors Unite</div><div>Bloomberg</div><div>
</div><div>June 13, 2014</div><div>
</div><div>Josh Rosner, managing director at Graham Fisher and Company, explores the many ills of Fannie Mae and Freddie Mac and political complications holding up action to replace them or resolve their issues. He speaks on Bloomberg Television’s “Bloomberg Surveillance.”</div><div>
</div><div>Read Full Article (and see video): To Fix or Not to Fix Fannie Mae and Freddie Mac</div><div>
</div><div>Pawlenty on the Best and Worst of Bank Regulation</div><div>
</div><div>Posted June 13, 2014 by Investors Unite</div><div>American Banker</div><div>
</div><div>June 10, 2014</div><div>
</div><div>Financial Services Roundtable CEO Tim Pawlenty discusses the after-effects of Dodd-Frank, the need to find regulatory balance between providing protection and hindering economic activity, concerns over the Johnson-Crapo GSE reform proposal, and more.</div><div>
</div><div>Read Full Article: Pawlenty on the Best and Worst of Bank Regulation </div><div>
</div><div>Home of Cards? Politics drives housing in weird ways</div><div>
</div><div>Posted June 13, 2014 by Investors Unite</div><div>Housing Wire</div><div>
</div><div>Friday, June 13, 2014, By Trey Garrison</div><div>
</div><div>With apologies to Re-Flex, the politics of housing that we normally talk about involves GSE reform, housing finance priorities, federal regulations and so on.</div><div>
</div><div>But politics very much enters into the consumer side of housing, too.</div><div>
</div><div>The partisan divide between Democrats and Republicans and between conservatives and liberals is widening, as you may have heard in news stories on a new Pew Poll survey or if you have a pulse and access to news media of any sort.</div><div>
</div><div>Read Full Article: Home of Cards? Politics drives housing in weird ways </div><div>
</div><div>Economic worries still dragging down housing market, Fannie Mae says</div><div>
</div><div>Posted June 13, 2014 by Investors Unite</div><div>Los Angeles Times</div><div>
</div><div>Tuesday, June 10, 2014, By Tim Logan</div><div>
</div><div>Broad concerns about the sluggish economy are still holding back the housing market, according to a survey released Monday by Fannie Mae.</div><div>
</div><div>The lending giant’s monthly national housing survey found that 57% of Americans think the economy is heading in “the wrong direction,” and chief economist Doug Duncan said that’s keeping a lot of people on the home-buying sidelines.</div><div>
</div><div>Read Full Article: Economic worries still dragging down housing market, Fannie Mae says</div><div>
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</div><div>To Fix or Not to Fix Fannie Mae and Freddie Mac</div><div>
</div><div>Posted June 13, 2014 by Investors Unite</div><div>Bloomberg</div><div>
</div><div>Friday, June 13, 2014</div><div>
</div><div>Josh Rosner, managing director at Graham Fisher and Company, explores the many ills of Fannie Mae and Freddie Mac and political complications holding up action to replace them or resolve their issues. He speaks on Bloomberg Television’s “Bloomberg Surveillance.”</div><div>
</div><div>Read Full Article: To Fix or Not to Fix Fannie Mae and Freddie Mac</div><div>
</div><div>GSE Reform and CFPB Transparency Take Center Stage on Capitol Hill</div><div>
</div><div>Posted June 13, 2014 by Investors Unite</div><div>National Mortgage Professional</div><div>
</div><div>Thursday, June 12, 2014, By Robert Ottone</div><div>
</div><div>Author Joshua Rosner appeared in Washington earlier today to talk about government-sponsored enterprise (GSE) reform. That age-old topic that gets brought up time and time again but never really has any headway made about it. While appearing before a group of Investors Unite members, Rosner made it clear that GSE reform could occur, with or without government assistance.</div><div>
</div><div>“There are consequences for lack of reform, or improper reform – the wrong kind of change may make things worse,” Rosner said. “Addressing GSE capital stack issues and reform go hand in hand.”</div><div>
</div><div>Read Full Article: GSE Reform and CFPB Transparency Take Center Stage on Capitol Hill</div><div>
</div><div>Fannie and Freddie Raking In ‘Tens Of Billions’ Of Dollars</div><div>
</div><div>Posted June 13, 2014 by Investors Unite</div><div>The Daily Caller</div><div>
</div><div>Wednesday, June 11, 2014, By Jonah Bennett</div><div>
</div><div>Congress’ main attempt to reform Fannie Mae and Freddie Mac after the 2008 financial crisis won’t protect the public, argues a leading expert on government-sponsored enterprises.</div><div>
</div><div>Josh Rosner, New York Times best-selling author and managing director at Graham Fisher & Co, issued this warning about the Johnson-Crapo bill in Washington on Tuesday.</div><div>
</div><div>Read Full Article: Fannie and Freddie Raking In ‘Tens Of Billions’ Of Dollars </div><div>
</div><div>Fannie, Freddie Saved By Tax-Free Mortgage Savings Account?</div><div>
</div><div>Posted June 13, 2014 by Investors Unite</div><div>Value Walk</div><div>
</div><div>Thursday, June 12, 2014, By Michael Ide</div><div>
</div><div> Investors Unite, the group formed campaign on behalf of Fannie Mae / Federal National Mortgage Assctn Fnni Me (OTCBB:FNMA) and Freddie Mac / Federal Home Loan Mortgage Corp (OTCBB:FMCC) shareholders, has been consistent opponent of the Crapo-Johnson proposal for Fannie Mae and Freddie Mac reform and the Corker-Warner bill that it was modeled after, but just because the Senate bill has lost momentum doesn’t mean they’ve met their goals. At a recent Investors United conference Joshua Rosner, the co-author of bestseller Reckless Endangerment, proposed a new way to help meet policy and social goals for the GSEs without having to create a new government agency: tax-free mortgage savings accounts.</div><div>
</div><div>Read Full Article: Fannie, Freddie Saved By Tax-Free Mortgage Savings Account? </div><div>
</div><div>GSE Reform and CFPB Transparency Take Center Stage on Capitol Hill</div><div>
</div><div>Posted June 12, 2014 by Investors Unite</div><div>National Mortgage Professional</div><div>
</div><div>June 12, 2014, By Robert Ottone</div><div>
</div><div>Author Joshua Rosner appeared in Washington earlier today to talk about government-sponsored enterprise (GSE) reform. That age-old topic that gets brought up time and time again but never really has any headway made about it. While appearing before a group of Investors Unite members, Rosner made it clear that GSE reform could occur, with or without government assistance.</div><div>
</div><div>“There are consequences for lack of reform, or improper reform – the wrong kind of change may make things worse,” Rosner said. “Addressing GSE capital stack issues and reform go hand in hand.”</div><div>
</div><div>Real Full Article: GSE Reform and CFPB Transparency Take Center Stage on Capitol Hill</div><div>
</div><div>Treasury Trampling Investors’ Rights</div><div>
</div><div>Posted June 11, 2014 by Investors Unite</div><div>Knoxville News Sentinel</div><div>
</div><div>June 11, 2014, By Ron Murphee</div><div>
</div><div>If the federal government has its way with mortgage companies Fannie Mae and Freddie Mac and continues to ignore the rights of shareholders, investors may think twice before putting money into government-sponsored enterprises — or any investment where the government is involved. I know I will.</div><div>
</div><div>Read Full Article: Treasury Trampling Investors’ Rights</div><div>
</div><div>Wall Street loses ally with Eric Cantor loss</div><div>
</div><div>Posted June 11, 2014 by Investors Unite</div><div>Politico </div><div>
</div><div>June 11, 2014, By MJ Lee</div><div>
</div><div>Wall Street and the financial services industry are losing a top ally in congressional leadership after House Majority Leader Eric Cantor was defeated in a primary contest on Tuesday, a shocking upset that raises questions about Republicans’ agenda for the rest of this year and in the next Congress.</div><div>
</div><div>Many lobbyists on K Street whose clients include major financial institutions consider Cantor a go to member in leadership on policy debates, including overhauling the mortgage finance market, extending the government backstop for terrorism insurance, how Wall Street should be taxed and flood insurance.</div><div>
</div><div>Real Full Article: Wall Street loses ally with Eric Cantor loss</div><div>
</div><div>CFPB, housing take center stage in Congress</div><div>
</div><div>Posted June 10, 2014 by Investors Unite</div><div>Housing Wire</div><div>
</div><div>Tuesday, June 10, 2014, By Trey Garrison</div><div>
</div><div>It’s going to be a busy morning in Washington D.C. on the housing front on Tuesday.</div><div>
</div><div>The morning kicks off with a breakfast and forum discussion hosted by Investors Unite on Solutions for U.S. Housing Policy and preserving homeownership.</div><div>
</div><div>It will be hosted at the Dirksen Senate Office Building starting at 7:30 a.m. ET.</div><div>
</div><div>Read Full Article: CFPB, housing take center stage in Congress</div><div>
</div><div>More Calls to Preserve Fannie and Freddie Instead of Killing Them</div><div>
</div><div>Posted June 10, 2014 by Investors Unite</div><div>Inside Mortgage Finance</div><div>
</div><div>June 10, 2014, By Charles Wisniowski</div><div>
</div><div>Meaningful housing finance reform that would include “fixing” Fannie Mae and Freddie Mac, rather than euthanizing them outright is still possible in 2014 and doesn’t require Congressional action, according to an expert panel speaking on the topic Tuesday morning on Capitol Hill. </div><div>
</div><div>Speaking at a GSE forum sponsored by Investors Unite, Joshua Rosner, managing director at Graham Fisher & Co., said that GSE reform should consist of repurposing rather than eliminating Fannie and Freddie.</div><div>
</div><div>Read Full Article: More Calls to Preserve Fannie and Freddie Instead of Killing Them</div><div>
</div><div>Fix the GSEs, don’t end them, Rosner says at Investors Unite</div><div>
</div><div>Posted June 10, 2014 by Investors Unite</div><div>Housing Wire</div><div>
</div><div>June 10, 2014, By Trey Garrison</div><div>
</div><div>Meaningful housing reform is possible in 2014 and doesn’t require Congressional action, renowned housing analyst and author Joshua Rosner told Investors Unite in Washington on Tuesday morning.</div><div>
</div><div>Rosner, bestselling author of “Reckless Endangerment” and of the “Most epic Twitter war ever,” presented his vision of how to move forward on housing reform and what the consequences are of getting housing reform wrong to the activist group of Fannie Mae and Freddie Mac investors, who have had their rights as shareholders suspended indefinitely.</div><div>
</div><div>Read Full Article: Fix the GSEs, don’t end them, Rosner says at Investors Unite</div><div>
</div><div>FHFA considers G-fee increase</div><div>
</div><div>Posted June 9, 2014 by Investors Unite</div><div>Housing Wire</div><div>
</div><div>June 09, 2014, By Ben Lane</div><div>
</div><div>The Federal Housing Finance Agency announced Thursday that it will be seeking industry input on the guarantee fees that Fannie Mae and Freddie Mac charge lenders.</div><div>
</div><div>In January, FHFA Director Mel Watt reversed a proposed increase on the g-fee, originally announced in December by then-acting director Ed DeMarco.</div><div>
</div><div>View Full Article: FHFA considers G-fee increase </div><div>
</div><div>Could New Bill Jeopardize Black Home Ownership?</div><div>
</div><div>Posted June 6, 2014 by Investors Unite</div><div>North Dallas Gazette</div><div>
</div><div>June 06, 2014, By Saeed Shabazz</div><div>
</div><div>A proposed bill could potentially impact two federal programs geared toward home ownership.</div><div>
</div><div>According to the Reverse Mortgage Daily, the new housing reform bill would scale down and eliminate the Government Sponsored Enterprises (GSEs) known as Freddie Mac and Fannie Mae, the lending programs which helped boost the percentage of Black home ownership.</div><div>
</div><div>The new bill would end the affordable housing goals of both programs and would be replaced with a new agency the Federal Mortgage Insurance Corporation, a government re-insurer, Marc Morial, President and CEO of the National Urban league explained to The Final Call.</div><div>
</div><div>Read Full Article: Could New Bill Jeopardize Black Home Ownership?</div><div>
</div><div>Home ownership </div><div>
</div><div>Posted June 5, 2014 by Investors Unite</div><div>Columbus Dispatch </div><div>
</div><div>June 5, 2014, By Marian Harris </div><div>
</div><div>Potential homeowners continue to face issues of home affordability. Legislative proposals being considered in the US Senate that seek to reform our housing mortgage market will make it more difficult for low and middle-income families to pursue the American dream of homeownership. </div><div>
</div><div>The proposal known as the Johnson-Crapo bill fails to include affordable housing goals and leaves little room for small lending institutions to provide for smaller markets that are often times ignored by big banks. Just as the housing market starts to bounce back, this reform would place unnecessary obstacles on purchasing a home without guaranteeing that the mortgage industry doesn’t fall into the hands of “too-big-to-fail” banks. </div><div>
</div><div>Read Full Article: Home ownership </div><div>
</div><div>The 3 Paths for Fannie Mae and Freddie Mac’s Future</div><div>
</div><div>Posted June 4, 2014 by Investors Unite</div><div>The Motley Fool</div><div>
</div><div>June 4, 2014, by Matt Koppenheffer</div><div>
</div><div>Fannie Mae and Freddie Mac continue to baffle investors: On the one hand, these are huge, profitable companies holding significant value. On the other, the federal government still holds a claim to all of their profits, one it acquired during the 2008 financial crisis. Will the government maintain the status quo, keeping both semi-public? Will it eliminate the two mortgage lenders entirely? Or will it return them to the private market?</div><div>
</div><div> In this segment of Where The Money Is, Fool Matt Koppenheffer discusses the three options and what he sees as their implications. Tune in to get a better understanding of the future of these two gigantic financial entities, and share your thoughts in the comments below.</div><div>
</div><div>View Full Article: The 3 Paths for Fannie Mae and Freddie Mac’s Future</div><div>
</div><div>Fannie and Freddie reform without respect for private property would cost everybody</div><div>
</div><div>Posted June 4, 2014 by Investors Unite</div><div>Washington Examiner</div><div>
</div><div>June 04, 2014, By James C. Miller</div><div>
</div><div>Shortly after the 2008 market collapse, Washington lawmakers hurried to bury the skeletons at the root of the Great Recession and housing crisis.</div><div>
</div><div>In recent months, however, with recognition that the “too big to fail problem” wouldn’t stay buried forever, these same lawmakers have shown an openness to addressing the proper roles of the government-sponsored enterprises, Fannie Mae and Freddie Mac.</div><div>
</div><div>View Full Article: Fannie and Freddie reform without respect for private property would cost everybody </div><div>
</div><div>S&P: Fannie, Freddie needed to sustain housing rebound</div><div>
</div><div>Posted June 3, 2014 by Investors Unite</div><div>Washington Times</div><div>
</div><div>June 3, 2014, by Patrice Hill</div><div>
</div><div>Standard & Poor’s Corp., one of Wall Street’s top credit agencies, said Tuesday that the fragile housing recovery cannot continue without support from Fannie Mae and Freddie Mac, the two mortgage finance giants many in Congress seem bent on eliminating.</div><div>
</div><div> Fannie and Freddie are entrenched in the housing market and have become critical to the success of the faltering recovery which began in 2011 after a deep, five-year recession, S&P analysts said.</div><div>
</div><div>View Full Article: S&P: Fannie, Freddie needed to sustain housing rebound</div><div>
</div><div>Carl Icahn Joins Bill Ackman In Bet On Fannie And Freddie</div><div>
</div><div>Posted June 3, 2014 by Investors Unite</div><div>Forbes</div><div>
</div><div>June 3, 2014, by Nathan Vardi</div><div>
</div><div>Carl Icahn appears to have joined the hedge fund party that is trying to make a fortune off of the resuscitation of mortgage giants Fannie Mae and Freddie Mac, the government sponsored enterprises that were bailed out during the financial crisis and placed into conservatorship.</div><div>
</div><div> Icahn took a $50 million position in Fannie Mae and Feddie Mac in March by buying common stock from Bruce Berkowitz’s Fairholme Funds. Icahn bought 6.8 million shares of Fannie Mae for $4.03 per share and 5.7 million shares of Freddie Mac for $4.04 per share, according to a court document that was reported by The Wall Street Journal and CNBC. Berkowtiz, who bet early and big on Fannie and Freddie, not only gets to book a nice gain on the shares he sold to Icahn, but he potentially also gets an ally in his effort to make outsized gains from his continued large position in both the common and preferred shares of the GSEs.</div><div>
</div><div>View Full Article: Carl Icahn Joins Bill Ackman In Bet On Fannie And Freddie</div><div>
</div><div>Fannie Mae: Icahn And Ackman Actually Agree On Something</div><div>
</div><div>Posted June 3, 2014 by Investors Unite</div><div>Seeking Alpha</div><div>
</div><div>June 3, 2014</div><div>
</div><div>Shares of the Federal National Mortgage Association (OTCQB:FNMA) have nearly doubled in the last year as activist investors and hedge fund managers rally behind the mortgage giant. Efforts in Congress to wind down the government-sponsored entities (GSE) have gone nowhere and there are several catalysts for upside. For further proof of the potential, the investment has actually brought Bill Ackman and Carl Icahn to agreement after years of bitterness.</div><div>
</div><div>View Full Article: Fannie Mae: Icahn And Ackman Actually Agree On Something</div><div>
</div><div>Millennials squeezed out of buying a home</div><div>
</div><div>Posted June 2, 2014 by Investors Unite</div><div>CNN Money</div><div>
</div><div>June 2, 2014, by Les Christie</div><div>
</div><div>The Millennial generation is great at many things: texting, social media, selfies. But buying a home? Not so much.</div><div>
</div><div> Just 36% of Americans under the age of 35 own a home, according to the Census Bureau. That’s down from 42% in 2007 and the lowest level since 1982, when the agency began tracking homeownership by age.</div><div>
</div><div>Full Article: Millennials squeezed out of buying a home</div><div>
</div><div>Fannie Mae and Freddie Mac: here to stay?</div><div>
</div><div>Posted June 2, 2014 by Investors Unite</div><div>The Banker</div><div>
</div><div>June 2, 2014 by Jane Monahan</div><div>
</div><div>Since their federal takeover in 2008, the fate of US mortgage underwriters Fannie Mae and Freddie Mac has hung in the balance. Politicians have jostled back and forth on the issue of winding them down, but without any workable and politically agreeable way to fill the void they would leave in the US housing market, it seems that the two institutions may be here to stay.</div><div>
</div><div> It could be argued that settling the fate of Fannie Mae and Freddie Mac, the US mortgage underwriters, is an urgent matter, considering the risks and distortions of their continued survival as government-owned and controlled enterprises</div><div>
</div><div>Full Articles: Fannie Mae and Freddie Mac: here to stay?</div><div>
</div><div>Why the GSEs need Congress to exit conservatorship</div><div>
</div><div>Posted May 30, 2014 by Investors Unite</div><div>Metro Trends</div><div>
</div><div>May 30, 2014, by Jim Parrott</div><div>
</div><div>In “Why Long-Term GSE Reform Requires Congress” I conclude that Fannie Mae and Freddie Mac (the enterprises or the GSEs) are hemmed into conservatorship by the terms of their Preferred Stock Purchase Agreements with Treasury (PSPAs). In “It’s time for administrative reform to end the GSE conservatorships,” Jim Millstein offers the logical response: why not just change the terms of the PSPAs?</div><div>
</div><div>View Full Article: Why the GSEs need Congress to exit conservatorship</div><div>
</div><div>It’s time for administrative reform to end the GSE conservatorships</div><div>
</div><div>Posted May 30, 2014 by Investors Unite</div><div>Metro Trends</div><div>
</div><div>May 30, 2014, by Jim Millstein</div><div>
</div><div>In a recent Urban Institute paper, Jim Parrott explains “Why Long-Term GSE Reform Requires Congress” and asserts that administrative reform of Fannie and Freddie is not economically viable. The firms are critically undercapitalized, allegedly unable to operate without their government backstop, the fair price of which their normalized earnings couldn’t bear. Mr. Parrott asserts that Fannie and Freddie therefore are doomed to remain wards of the conservatorship, the exits closed, until Congress decides to act. The “difficult math of GSE reform” makes it impossible and those of us advocating otherwise are fooling ourselves.</div><div>
</div><div>View Full Article: It’s time for administrative reform to end the GSE conservatorships</div><div>
</div><div>Housing reform must respect shareholder rights</div><div>
</div><div>Posted May 30, 2014 by Investors Unite</div><div>The Hill</div><div>
</div><div>May 30, 2014, by Guari Shah, Elizabeth Harrison Jonathan Slater and Brandon Mial</div><div>
</div><div> The housing collapse of 2008 left devastation in its wake, devastation we are still recovering from today. The sale of subprime, and in some cases, fraudulent loans by the big banks and a whole host of other bad practices led to the crisis and our leaders in Washington are correct in their assertion that housing reform needs to be addressed.</div><div>
</div><div> However, the legislation proposed by Sens. Mike Crapo (R-Ida.) and Tim Johnson (D-S.D.) would not only increase risk to taxpayers during a repeat housing crisis, but also refuses to recognize marketplace rules and the rule of law.</div><div>
</div><div>Full Article: Housing reform must respect shareholder rights</div><div>
</div><div>Here’s how to really help families obtain housing</div><div>
</div><div>Posted May 28, 2014 by Investors Unite</div><div>The Hill</div><div>
</div><div>May 28, 2014, by James Carr</div><div>
</div><div>On May 15, the Senate Banking Committee approved a bill to restructure the U.S. housing finance system. The bipartisan proposal, which was drafted by Banking Committee Chairman Sen. Tim Johnson (D-S.D.) and Ranking Member Sen. Mike Crapo (R-Idaho), seeks to repair a broken housing market. That action is long overdue.</div><div>
</div><div> Mortgage originations are at their lowest level in 17 years, Millions of school teachers, firefighters, police officers, librarians, military personnel and other qualified moderate-income and low-wealth borrowers are unnecessarily denied access to home loans because lenders have, with overly rigid underwriting practices, overcorrected for their reckless and irresponsible lending leading up to the mortgage crisis.</div><div>
</div><div>Full Article: Here’s how to really help families obtain housing</div><div>
</div><div>5 things you must know about housing for the rest of 2014</div><div>
</div><div>Posted May 28, 2014 by Investors Unite</div><div>Housing Wire</div><div>
</div><div>May 28, 2014</div><div>
</div><div>The future of housing for 2014 looks a lot different – and a lot darker – than it did at the start of the year.</div><div>
</div><div> Either fundamentals have changed, or the evidence is getting so overwhelming that neither the most hopeful naiveté or calculating spin can cover it.</div><div>
</div><div>Full Article: 5 things you must know about housing for the rest of 2014</div><div>
</div><div>What GSE Reform Impasse Means for Other Bank Rules</div><div>
</div><div>Posted May 27, 2014 by Investors Unite</div><div>American Banker</div><div>
</div><div>May 27, 2014, By Joe Adler</div><div>
</div><div>The Congressional stalemate over housing finance reform has left looming questions about the scope and enforcement of other bank regulations already in the pipeline.</div><div>
</div><div> The fate of the government-sponsored enterprises Fannie Mae and Freddie Mac is commingled with various other regulatory provisions stemming from the crisis. Most notably, the Consumer Financial Protection Bureau’s underwriting overhaul — known as the qualified mortgage rule — and the separate pending risk retention requirement for securitizers both provide substantial flexibility to Fannie- and Freddie-backed loans while the GSEs are still in conservatorship. How long they stay open also affects how long banks can use GSE-issued securities to comply with new capital and liquidity rules.</div><div>
</div><div> View Full Article: What GSE Reform Impasse Means for Other Bank Rules </div><div>
</div><div> </div><div>
</div><div>GSE Reform Faces an Uncertain Future</div><div>
</div><div>Posted May 26, 2014 by Investors Unite</div><div>Credit Union Times</div><div>
</div><div>May 26, 2014, By Nicholas Ballasy</div><div>
</div><div>Housing finance reform legislation passed the Senate Banking, Housing and Urban Affairs Committee on May 15 but its future is uncertain.</div><div>
</div><div> The Housing Finance Reform and Taxpayer Protection Act cleared by a 13-9 vote. Against it were Sens. Jack Reed (D-R.I.), Bob Menendez (D-N.J.), Sherrod Brown (D-Ohio), Jeff Merkley (D-Ore.), Chuck Schumer (D-N.Y.), Elizabeth Warren (D-Mass.), Richard Shelby (R-Ala.), Patrick Toomey (R-Pa.) and David Vitter (R-La.).</div><div>
</div><div>View Full Article: GSE Reform Faces an Uncertain Future </div><div>
</div><div>At Fannie Mae and Freddie Mac, Investors Get the Cold Shoulder</div><div>
</div><div>Posted May 25, 2014 by Investors Unite</div><div>The Motley Fool</div><div>
</div><div>May 25, 2014, by Amanda Alix</div><div>
</div><div>If you thought that mortgage giants Fannie Mae (NASDAQOTCBB: FNMA ) and Freddie Mac (NASDAQOTCBB: FMCC ) were on their way to oblivion, think again. The new head of the Federal Housing Finance Agency, Mel Watt, has decided that expanding mortgage credit and repaying taxpayers are a priority for the two agencies – and he can’t say enough about it.</div><div>
</div><div> As for Fannie and Freddie shareholders, Watt recently told an interviewer: “I don’t lay awake at night worrying about what’s fair to the shareholders.”</div><div>
</div><div>View Full Article: At Fannie Mae and Freddie Mac, Investors Get the Cold Shoulder</div><div>
</div><div>Why Fannie and Freddie’s failed stress test proves nothing</div><div>
</div><div>Posted May 22, 2014 by Investors Unite</div><div>The Hill</div><div>
</div><div>May 22, 2014, by Ike brannon</div><div>
</div><div>A stress test analysis of the solvency of Fannie Mae and Freddie Mac, the Government-Sponsored Entities (or GSEs) charged with providing liquidity to the mortgage market to boost home ownership, showed that neither has enough capital to withstand another severe financial blow of the sort that occurred during the 2008 financial crisis.</div><div>
</div><div>The results of this exercise suggest that a recurrence would cost the Treasury roughly the same amount of money as it put into the GSEs after the last crisis, which is somewhere in the vicinity of $190 billion.</div><div>
</div><div>Treasury officials—such as Michael Stegman, the department’s counselor for housing finance, suggested that these results buttress Treasury’s 2012 decision to sweep the entire net worth of the two entities into their coffers each quarter: The argument is that if Treasury is the backstop of two entities that apparently need one, it’s only right that they—and not any of the other shareholders—get paid for assuming that risk.</div><div>
</div><div>View Full Article: Why Fannie and Freddie’s failed stress test proves nothing</div><div>
</div><div>Fannie, and Freddie aren’t going away, Watt says</div><div>
</div><div>Posted May 22, 2014 by Investors Unite</div><div>MarketWatch</div><div>
</div><div>May 21, 2014, by Darrell Delamaide</div><div>
</div><div>One of the country’s biggest political footballs, housing finance reform, took some funny bounces over the past week.</div><div>
</div><div> Most notable were the first public appearances by the government’s new point man for running Fannie Mae DE:FNM +2.45% and Freddie Mac FMCC +0.46% , former North Carolina Congressman Mel Watt, who took office as director of the Federal Housing Finance Agency in January and was nominated more than a year ago.</div><div>
</div><div>View full Article: Fannie, and Freddie aren’t going away, Watt says</div><div>
</div><div>Fannie Mae: “Housing remains worrisome”</div><div>
</div><div>Posted May 22, 2014 by Investors Unite</div><div>Housing Wire</div><div>
</div><div>May 22, 2014, by Brena Swanson</div><div>
</div><div>Despite a rocky start to the year, the second quarter will paint a much different picture, with recent indicators suggesting that the economy will pick back up in the second quarter.</div><div>
</div><div> According to the latest Fannie Mae housing report, March and April presented strong reports for consumers, paving the way for a strong second quarter.</div><div>
</div><div>View Full Article: Fannie Mae: “Housing remains worrisome”</div><div>
</div><div>Housing Outlook Remains Iffy, Economy on Right Path: Fannie Mae</div><div>
</div><div>Posted May 22, 2014 by Investors Unite</div><div>American Banker</div><div>
</div><div>May 22, 2014, by Evan Nemeroff</div><div>
</div><div>Fannie Mae cut its forecast of industry wide home purchase lending for 2014 to $710 billion from $732 billion, underscoring the housing industry’s struggles despite overall positive signs for the economy.</div><div>
</div><div> Existing home sales, new home sales, housing starts, and multifamily data all suffered first-quarter year-over-year declines despite improving consumer attitudes, noted Fannie Mae’s chief economist, Doug Duncan, in the government-sponsored enterprise’s May forecast. Furthermore, concerns over the Federal Reserve’s tapering of monetary stimulus could affect home sales and loan originations.</div><div>
</div><div>View Full Article: Housing Outlook Remains Iffy, Economy on Right Path: Fannie Mae</div><div>
</div><div>Why Overhauling Fannie Mae and Freddie Mac Needs Congress</div><div>
</div><div>Posted May 22, 2014 by Investors Unite</div><div>Wall Street Journal</div><div>
</div><div>May 22, 2014, By Nick Timiraos</div><div>
</div><div>Legislative efforts to overhaul Fannie MaeFNMA -0.05% and Freddie MacFMCC +0.46% look unlikely to advance this year, and ideological gridlock doesn’t appear likely to abate during the next session of Congress. That’s leading to more questions from housing-finance insiders and the mortgage giants’ shareholders about whether it’s possible to overhaul the companies through administrative fiat.</div><div>
</div><div> In other words, can Fannie and Freddie easily exit their government-run conservatorship and be restored as private companies without an act of Congress? Jim Parrott, a former housing adviser in the Obama White House, says that the answer is no in an article published Thursday by the Urban Institute. Here’s a look at the analysis:</div><div>
</div><div>View Full Article: Why Overhauling Fannie Mae and Freddie Mac Needs Congress </div><div>
</div><div>What Is the Future of Fannie Mae and Freddie Mac?</div><div>
</div><div>Posted May 21, 2014 by Investors Unite</div><div>The Motley Fool</div><div>
</div><div>May 21, 2014, By Tim Manni</div><div>
</div><div>The future of Fannie Mae and Freddie Mac is up for debate.</div><div>
</div><div>A bill introduced by Senators Tim Johnson and Mike Crapo calls for the winding down of the mortgage giants. Given that both Fannie Mae and Freddie Mac have been instrumental players together in the U.S. mortgage industry for nearly 50 years, there is obvious speculation about what the future would hold without them. Will mortgage rates rise? Will getting a mortgage be even more difficult?</div><div>
</div><div>View Full Article: What Is the Future of Fannie Mae and Freddie Mac?</div><div>
</div><div>Watt Plan Would End Second-Fiddle Status of Freddie MBS</div><div>
</div><div>Posted May 20, 2014 by Investors Unite</div><div>American Banker</div><div>
</div><div>May 20, 2014, by Brian Collins</div><div>
</div><div>Freddie Mac has long struggled to compete with larger rival Fannie Mae because the former’s mortgage-backed securities trade at a discount to the latter’s. Their new regulator may change that.</div><div>
</div><div> As government sponsored enterprises operating in federal conservatorship, Fannie and Freddie are, in theory, equally creditworthy. Yet for a number of esoteric reasons, investors treat Freddie’s MBS, which Freddie calls “participation certificates” or PCs, as if they are lower-grade bonds than those guaranteed by Fannie. This has forced the smaller GSE to prop up the liquidity and pricing of its PCs to maintain market share.</div><div>
</div><div>View full Article: Watt Plan Would End Second-Fiddle Status of Freddie MBS</div><div>
</div><div>Legislative proposal undermines Watt’s goals</div><div>
</div><div>Posted May 20, 2014 by Investors Unite</div><div>Charlotte Observer</div><div>
</div><div>May 19, 2014, by Eva Clayton</div><div>
</div><div>The writer is a former member of Congress.</div><div>
</div><div> It is clear that the Federal Housing Finance Administration, under the leadership of Director Mel Watt, has done an extensive assessment of Fannie Mae and Freddie Mac.</div><div>
</div><div>The strategic goals laid out by Watt maintain stability in the current housing market by seeking to broaden liquidity and reduce taxpayer risk.</div><div>
</div><div>View Full Article: Legislative proposal undermines Watt’s goals</div><div>
</div><div>Stevens: Lack of congressional action precarious for Fannie, Freddie</div><div>
</div><div>Posted May 20, 2014 by Investors Unite</div><div>The Hill</div><div>
</div><div>May 20, 2014, By Vicki Needham</div><div>
</div><div>A top housing industry official said Monday that lack of congressional action on legislation to overhaul mortgage giants Fannie Mae and Freddie Mac puts lawmakers in a precarious position in case of another financial crisis.</div><div>
</div><div>David Stevens, head of the Mortgage Bankers Association, said that without more support for a bill crafted by Senate Banking Committee leaders the measure will remain at a “political stand-still” while the mortgage finance market remains primarily under government control.</div><div>
</div><div>View Full Article: Stevens: Lack of congressional action precarious for Fannie, Freddie</div><div>
</div><div>Senate Committee Approves Fannie Mae/Freddie Mac Repeal, But May Repeat Crisis</div><div>
</div><div>Posted May 20, 2014 by Investors Unite</div><div>National Legal and Policy Center</div><div>
</div><div>May 20, 2014, by Carl Horowitz</div><div>
</div><div>Everyone in Washington favors “reform.” Unfortunately, the term can be highly deceptive. Such is the case of the Housing Finance Reform and Taxpayer Protection Act of 2014 (S.1217), a bill that would abolish troubled mortgage giants Fannie Mae and Freddie Mac in favor of a federally-backed private insurance system. Last Thursday, the Senate Banking Committee approved the measure by a 13-9 vote. Yet the bill, sponsored by Sens. Tim Johnson, D-S.D., and Mike Crapo, R-Idaho, may never reach the Senate floor – and not undeservedly. For the real problem with Fannie Mae and Freddie Mac, which now are profitable and have more than repaid their federal bailout debt, is not their existence; it is their subjection to tight federal control. The “new” system would retain and even expand this control, while not restoring the rights of shareholders left high and dry.</div><div>
</div><div>National Legal and Policy Center several times during the past year (such as here and here) has explained the precarious situation of the Washington, D.C.-based Federal National Mortgage Association (“Fannie Mae”) and the McLean, Va.-based Federal Home Loan Mortgage Corporation (“Freddie Mac”) in the context of a political culture of government bailouts. These congressionally-chartered companies, though shareholder-owned, have operated with a unique public mission: the creation of residential mortgage liquidity. At their rudimentary level, Fannie Mae and Freddie Mac, as “secondary” market mortgage providers, buy existing home loans from primary lenders, such as banks and savings & loan associations, and then either hold these loans as investments or (almost inevitably) package them into pools of marketable bonds known as “mortgage-backed securities.” Fannie Mae and Freddie Mac effectively serve as middlemen, linking housing and capital markets. Ideally, everyone benefits. Banks shed potentially unproductive long-term assets in return for quick cash and thus expand their possibilities for lending; institutional and individual bond investors receive a guaranteed steady yield; and homebuyers realize interest rate reductions of typically anywhere from 20 to 50 basis points (i.e., 0.2 to 0.5 percentage points). But the story hasn’t worked out according to script.</div><div>
</div><div>View Full Article: Senate Committee Approves Fannie Mae/Freddie Mac Repeal, But May Repeat Crisis</div><div>
</div><div>Taking Stock: Shareholder Lawsuits No Barrier to GSE Dissolution</div><div>
</div><div>Posted May 19, 2014 by Investors Unite</div><div>The Heritage Foundation</div><div>
</div><div>May 19, 2014, By James Gattuso</div><div>
</div><div>Fannie Mae and Freddie Mac, the two government-sponsored enterprises (GSEs) that were at the center of the financial collapse of 2008, have now been in federal conservatorship for nearly six years. Several bills are pending in Congress to end the conservatorships and dissolve the firms, although the proposals differ on what—if anything—should replace them.[1]</div><div>
</div><div>At the same time, a number of lawsuits have been filed against the federal government by disgruntled private shareholders of Fannie and Freddie. The most serious of these claims is that the current practice of “sweeping” all earnings by Fannie and Freddie to the U.S. Treasury is unconstitutional. While this claim is not without merit, it should not be allowed to impede needed efforts to dissolve the corporations.</div><div>
</div><div>View Full Article: Taking Stock: Shareholder Lawsuits No Barrier to GSE Dissolution</div><div>
</div><div>Housing Finance Reform Should Now Focus on Fixing and Preserving Fannie Mae and Freddie Mac</div><div>
</div><div>Posted May 19, 2014 by Investors Unite</div><div>Huffington Post, May 19, 2014</div><div>
</div><div>May 19, 2014, By John Taylor</div><div>
</div><div>The sharply divided Senate Banking Committee vote on the Johnson-Crapo housing finance reform measure should serve as a clear signal that it is time for Congress to go back to the drawing board on plans for our system of housing finance. The Johnson-Crapo bill has serious problems for working Americans. If the bill in its current form became law, it would do enormous harm to homeownership opportunity. The bill must not be given a floor vote in the Senate.</div><div>
</div><div>There has been an ill-advised and misplaced push to get rid of Fannie Mae and Freddie Mac. Doing so would be a mistake. Fannie Mae and Freddie Mac have affordable housing goals, which help to make sure that the market serves underserved communities, and which have had a tremendous positive impact. The Johnson-Crapo bill eliminates the affordable housing goals and does not do enough to ensure that all creditworthy borrowers are able to access conventional mortgage credit. Among the bill’s problems: it would create a system where the regulator does not have meaningful authority to require institutions to serve all communities fairly. That is just one of several serious issues with the bill.</div><div>
</div><div>View Full Article: Housing Finance Reform Should Now Focus on Fixing and Preserving Fannie Mae and Freddie Mac</div><div>
</div><div>Legislative proposal undermines Watt’s goals</div><div>
</div><div>Posted May 19, 2014 by Investors Unite</div><div>Charlotte Observer</div><div>
</div><div>May 19, 2014, By Eva Clayton</div><div>
</div><div>The writer is a former member of Congress.</div><div>
</div><div>It is clear that the Federal Housing Finance Administration, under the leadership of Director Mel Watt, has done an extensive assessment of Fannie Mae and Freddie Mac.</div><div>
</div><div>The strategic goals laid out by Watt maintain stability in the current housing market by seeking to broaden liquidity and reduce taxpayer risk.</div><div>
</div><div>View Full Article: Legislative proposal undermines Watt’s goals</div><div>
</div><div>U.S. private lenders not ready to replace Fannie, Freddie: regulator</div><div>
</div><div>Posted May 18, 2014 by Investors Unite</div><div>Reuters</div><div>
</div><div>May 18, 2014, by Margaret Chadbourn</div><div>
</div><div>The regulator of government-controlled mortgage finance firms Fannie Mae (FNMA.OB) and Freddie Mac (FMCC.OB) said on Sunday he would not oppose them having a smaller presence in the market but private capital had to be ready to take over first.</div><div>
</div><div> Federal Housing Finance Agency Director Mel Watt said the two companies, which own or guarantee about 60 percent of all U.S. home loans, needed to remain in the housing finance market to make sure it was liquid and resilient.</div><div>
</div><div>View Full Article: U.S. private lenders not ready to replace Fannie, Freddie: regulator</div><div>
</div><div>Fannie Mae And Freddie Mac Are Undercapitalized</div><div>
</div><div>Posted May 18, 2014 by Investors Unite</div><div>Seeking Alpha</div><div>
</div><div>May 18, 2014, By Glen Bradford</div><div>
</div><div>The Third Amendment Net Worth Sweep is Illegal</div><div>
</div><div>I recommend listening to Charles J. Cooper’s interview with The Federalist Society to better understand the illegal nature of the Third Amendment Net Worth Sweep. The law was broken. Discovery is happening. This will be retroactively fixed. Until it is fixed, the way that the sweep works is very bad business and forces bad internal decision making and capital allocation.</div><div>
</div><div>View Full Article: Fannie Mae And Freddie Mac Are Undercapitalized</div><div>
</div><div>FHFA’s Watt ‘Comfortable’ With U.S. Sweep of Fannie, Freddie Profits</div><div>
</div><div>Posted May 16, 2014 by Investors Unite</div><div>Wall Street Journal</div><div>
</div><div>May 16, 2014, by Nick Timiraos</div><div>
</div><div>The government’s policy of sweeping away most profits of Fannie MaeFNMA -1.29% and Freddie MacFMCC -0.47% is reasonable given the open-ended support provided by the government to stabilize them, the firms’ newly installed regulator said in an interview on Friday.</div><div>
</div><div> The U.S. faces a series of lawsuits from shareholders challenging changes made to Fannie and Freddie’s bailout agreements that require them to send all of their profits to the government.</div><div>
</div><div>View Full Article: FHFA’s Watt ‘Comfortable’ With U.S. Sweep of Fannie, Freddie Profits </div><div>
</div><div>Fannie-Freddie Bill to Get Panel Vote as Prospects Fade</div><div>
</div><div>Posted May 15, 2014 by Investors Unite</div><div>Bloomberg</div><div>
</div><div>May 15, 2014, by Clea Benson</div><div>
</div><div>The U.S. Senate Banking Committee is set today to advance a housing-finance bill that would wind down Fannie Mae (FNMA:US) and Freddie Mac (FMCC:US), even as weakening Democratic enthusiasm for the measure dims its chances of becoming law.</div><div>
</div><div>View Full Article: Fannie-Freddie Bill to Get Panel Vote as Prospects Fade</div><div>
</div><div>Five Key Hurdles in Fannie, Freddie Overhaul</div><div>
</div><div>Posted May 15, 2014 by Investors Unite</div><div>Wall Street Journal</div><div>
</div><div>May 15, 2014, by Nick Timiraos</div><div>
</div><div>The Senate Banking Committee is set to vote Thursday on a bipartisan bill to overhaul Fannie MaeFNMA +0.87% and Freddie MacFMCC +2.67%, but a series of thorny technical issues have made it hard to build a hoped-for “supermajority.”</div><div>
</div><div>The bill, which is supported by the White House, is expected to win a bipartisan majority of the 22-member panel, including the heads of the committee, Sens. Tim Johnson (D., S.D.) and Mike Crapo (R., Idaho), who offered the bill in March. This is an accomplishment few would have predicted a little more than a year ago, when Republicans and Democrats weren’t finding common ground on an issue as thorny as overhauling the nation’s $10 trillion mortgage market.</div><div>
</div><div>View Full Article: Five Key Hurdles in Fannie, Freddie Overhaul</div><div>
</div><div>Fannie-Freddie Overhaul Bill Advances: What’s Next?</div><div>
</div><div>Posted May 15, 2014 by Investors Unite</div><div>Wall Street Journal</div><div>
</div><div>May 15, 2014, by Nick Timiraos</div><div>
</div><div>The Senate Banking Committee approved on Thursday a bipartisan measure to overhaul Fannie MaeFNMA and Freddie MacFMCC on a 13-9 vote, attracting nearly as many Republicans as Democrats.</div><div>
</div><div>View Full Article: Fannie-Freddie Overhaul Bill Advances: What’s Next?</div><div>
</div><div>Congress Is Debating the Future of Fannie Mae and Freddie Mac Today. What Does That Mean for Taxpayers?</div><div>
</div><div>Posted May 15, 2014 by Investors Unite</div><div>The Foundry</div><div>
</div><div>May 15, 2014, by Rob Bluey</div><div>
</div><div>The Senate Banking Committee meets today at 10 a.m. to consider a housing finance bill that eliminates Fannie Mae and Freddie Mac but leaves taxpayers on the hook in the event of another financial crisis.</div><div>
</div><div>Sens. Tim Johnson, D-S.D., and Mike Crapo, R-Idaho, delayed consideration of the Housing Finance Reform and Taxpayer Protection Act (S. 1217) last month in hopes of securing more support for the measure. The committee has enough votes to approve the bill, but several conservatives and as many as six Democrats remain opposed or undecided.</div><div>
</div><div>View Full Article: Congress Is Debating the Future of Fannie Mae and Freddie Mac Today. What Does That Mean for Taxpayers?</div><div>
</div><div>Johnson-Crapo Is Fannie and Freddie on Steroids</div><div>
</div><div>Posted May 15, 2014 by Investors Unite</div><div>Open Market</div><div>
</div><div>May 15, 2014, by John Berlau</div><div>
</div><div>Today, after delays and much opposition from many quarters on different grounds, the Johnson-Crapo housing finance overhaul is set to be voted on by the Senate Banking Committee. If it clears, the vote will likely be narrow.</div><div>
</div><div>The Competitive Enterprise Institute coordinated a letter opposing the legislation signed by 26 leaders of conservative and free-market groups. Here are four key reasons to why Johnson-Crapo, named for Senate Banking Chairman Tim Johnson (D-S.D.) and and Ranking Member Mike Crapo (R-Idaho), is such a monstrosity.</div><div>
</div><div>View Full Article: Johnson-Crapo Is Fannie and Freddie on Steroids</div><div>
</div><div>Corker housing finance bill clears panel</div><div>
</div><div>Posted May 15, 2014 by Investors Unite</div><div>The Tennessean</div><div>
</div><div>May 15, 2014, by Paul Barton</div><div>
</div><div>Sen. Bob Corker’s year-long quest to revamp the housing finance system cleared committee Thursday, but the Tennessee senator acknowledged he will need more support to get a Senate floor vote.</div><div>
</div><div>By a 13-9 margin, the Senate Banking, Housing and Urban Affairs Committee approved legislation that calls for a five-year phase-out of the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac).</div><div>
</div><div>View Full Article: Corker housing finance bill clears panel</div><div>
</div><div>Congress Is Stealing Fannie and Freddie</div><div>
</div><div>Posted May 14, 2014 by Investors Unite</div><div>Real Clear Markets</div><div>
</div><div>May 14, 2014, by Jonathan Macey and Logan Beirne</div><div>
</div><div>Politicians are running rough-shod over the rule of law as they seek to rob private citizens of their assets to achieve their own amorphous political objectives. If we were speaking of some banana republic, this would be par for the course – but this is unfolding in the United States today.</div><div>
</div><div>The Federal National Mortgage Association (commonly known as “Fannie Mae”) and the Federal Home Loan Mortgage Corporation (Freddie Mac) remain two of the largest companies in the world, as measured by both asset value and revenue. The shares of these privately owned, for-profit mortgage finance companies trade on the New York Stock Exchange. They are known as “government sponsored entities” (GSEs) due to their federal charters, which charge each with providing stability and assistance to the secondary mortgage market and promoting access to mortgage credit.</div><div>
</div><div>View Full Article: Congress Is Stealing Fannie and Freddie</div><div>
</div><div>Fannie Mae, Freddie Mac reform will only get harder</div><div>
</div><div>Posted May 14, 2014 by Investors Unite</div><div>Politico</div><div>
</div><div>May 14, 2014, by Jon Prior</div><div>
</div><div>The leading Senate proposal to get rid of Fannie Mae and Freddie Mac is stalled, and the job of figuring out what to do with the two mortgage finance giants isn’t going to get any easier in the final years of the Obama administration.</div><div>
</div><div>The Senate Banking Committee on Thursday is set to approve a centrist bill backed by the White House, but the legislation is unlikely to advance any further this year and faces opposition from the senators most likely to be calling the shots on housing issues in the next Congress.</div><div>
</div><div>View Full Article: Fannie Mae, Freddie Mac reform will only get harder</div><div>
</div><div>Mel Watt Outlines Strategic Plan For Fannie Mae, Freddie Mac</div><div>
</div><div>Posted May 14, 2014 by Investors Unite</div><div>Value Walk</div><div>
</div><div>May 14, 2014, By Michael Ide</div><div>
</div><div>In his first speech since taking over the role of Federal Housing Finance Agency (FHFA) director, Mel Watt finally shared his strategic vision for Fannie Mae / Federal National Mortgage Assctn Fnni Me (OTCBB:FNMA) and Freddie Mac / Federal Home Loan Mortgage Corp (OTCBB:FMCC). While he made it clear that he wouldn’t comment on Crapo-Johnson or any of the other legislative initiatives addressing GSE reform, the direction that Watt is taking shows a commitment to a strong Federal role in the mortgage market.</div><div>
</div><div>View Full Article: Mel Watt Outlines Strategic Plan For Fannie Mae, Freddie Mac</div><div>
</div><div>Congress Is Stealing Fannie and Freddie</div><div>
</div><div>Posted May 14, 2014 by Investors Unite</div><div>Real Clear Markets</div><div>
</div><div>May 14, 2014, By Jonathan Macey & Logan Beirne</div><div>
</div><div>Politicians are running rough-shod over the rule of law as they seek to rob private citizens of their assets to achieve their own amorphous political objectives. If we were speaking of some banana republic, this would be par for the course – but this is unfolding in the United States today.</div><div>
</div><div>The Federal National Mortgage Association (commonly known as “Fannie Mae”) and the Federal Home Loan Mortgage Corporation (Freddie Mac) remain two of the largest companies in the world, as measured by both asset value and revenue. The shares of these privately owned, for-profit mortgage finance companies trade on the New York Stock Exchange. They are known as “government sponsored entities” (GSEs) due to their federal charters, which charge each with providing stability and assistance to the secondary mortgage market and promoting access to mortgage credit.</div><div>
</div><div>As the mortgage crisis gained momentum in 2007, the federal government directed Fannie Mae and Freddie Mac to purchase subprime and other risky securities to bolster the economy and stabilize the industry. Unsurprisingly, this caused Fannie and Freddie to be hit particularly hard by the financial crisis of 2008. Even though the companies never became insolvent, Congress passed the Housing and Economic Recovery Act of 2008 (HERA) to take control over Fannie and Freddie, placing the companies under the FHFA.</div><div>
</div><div>View Article: Congress Is Stealing Fannie and Freddie</div><div>
</div><div>Bill Revising Fannie Mae Has Dim Prospects, Democrat Says</div><div>
</div><div>Posted May 13, 2014 by Investors Unite</div><div>Bloomberg</div><div>
</div><div>May 13, 2014, by Kathleen Hunter</div><div>
</div><div>A Democratic member of the U.S. House Financial Services Committee predicted that legislation revamping government-owned mortgage firms Fannie Mae and Freddie Mac (FMCC) won’t become law this year.</div><div>
</div><div>“The problem is the clock right now,” Representative Gary Peters, a Michigan Democrat, told Bloomberg News reporters and editors today in New York. “I think it’s going to be difficult to get anything done this year.”</div><div>
</div><div>View Article: Bill Revising Fannie Mae Has Dim Prospects, Democrat Says</div><div>
</div><div>Fannie, Freddie’s regulator won’t cut loan limits</div><div>
</div><div>Posted May 13, 2014 by Investors Unite</div><div>MarketWatch</div><div>
</div><div>May 13, 2014, by Ruth Mantell</div><div>
</div><div>Mortgage-finance giants Fannie Mae and Freddie Mac won’t be directed to lower the limits for mortgages that they back, the head of their federal regulator said Tuesday.</div><div>
</div><div>In a departure from his predecessor, Mel Watt, director of the Federal Housing Finance Agency, is generally seen as favoring efforts to maintain borrowers’ access to credit, rather than focusing on winding down the government sponsored enterprises.</div><div>
</div><div>“This decision is motivated by concerns about how such a reduction could adversely impact the health of the current housing finance market,” Watt said Tuesday at a Brookings Institution event.</div><div>
</div><div>View Article: Fannie, Freddie’s regulator won’t cut loan limits</div><div>
</div><div>Regulator opens door wider for Americans on mortgages</div><div>
</div><div>Posted May 13, 2014 by Investors Unite</div><div>Reuters</div><div>
</div><div>May 13, 2014</div><div>By Margaret Chadbourn</div><div>
</div><div>The regulator of Fannie Mae and Freddie Mac on Tuesday laid out new policies that could make it easier for many Americans to obtain mortgages, in part by holding off on any reduction in the size of loans the firms can buy.</div><div>
</div><div>Federal Housing Finance Agency Director Mel Watt, in his first public speech since taking office in early January, also said the two government-controlled mortgage finance giants would ease standards that govern when banks must buy back faulty loans from them, which could also help loosen the credit taps.</div><div>
</div><div>View Article: Regulator opens door wider for Americans on mortgages</div><div>
</div><div>Fannie-Freddie Overseer: Loan Limits Won’t Be Cut</div><div>
</div><div>Posted May 13, 2014 by Investors Unite</div><div>AP</div><div>
</div><div>May 13, 2014</div><div>
</div><div>The regulator overseeing government-controlled mortgage giants Fannie Mae and Freddie Mac has announced a policy that could make more loan money available to borrowers.</div><div>
</div><div>Mel Watt, the director of the Federal Housing Finance Agency, said Tuesday in his first public speech that the agency will not reduce current limits on amounts of mortgages that Fannie and Freddie can purchase. The decision was based on concern that a reduction could negatively affect the health of the $10 trillion housing-finance market, he said.</div><div>
</div><div>View Article: Fannie-Freddie Overseer: Loan Limits Won’t Be Cut</div><div>
</div><div>Mel Watt signals change in federal housing finance policy</div><div>
</div><div>Posted May 13, 2014 by Investors Unite</div><div>Charlotte Observer</div><div>
</div><div>May 13, 2014, by Andrew Dunn</div><div>
</div><div>Former Charlotte representative Mel Watt signaled a change in how the government will approach housing finance policy in one of his first public speeches since taking over as head of the regulator of mortgage giants Fannie Mae and Freddie Mac.</div><div>
</div><div>Instead of shrinking their role in the mortgage market, the Federal Housing Finance Agency will direct Fannie and Freddie to increase liquidity in the market. Several policy changes should allow banks to expand access to mortgages to more borrowers, Watt said in his presentation at the Brookings Institution in Washington.</div><div>
</div><div>View Article: Mel Watt signals change in federal housing finance policy</div><div>
</div><div>Overseer Shifts Course on Fannie Mae and Freddie Mac</div><div>
</div><div>Posted May 13, 2014 by Investors Unite</div><div>New York Times</div><div>
</div><div>May 13, 2014, by Annie Lowrey</div><div>
</div><div>The federal overseer of Fannie Mae and Freddie Mac on Tuesday announced policies that would maintain the mortgage giants’ role in parts of the housing market, spur more home lending and aid distressed homeowners.</div><div>
</div><div>The announcement is a significant shift in strategy for the mortgage financiers, driven by the new director of the Federal Housing Finance Agency, Melvin L. Watt.</div><div>
</div><div>View Article: Overseer Shifts Course on Fannie Mae and Freddie Mac</div><div>
</div><div>Monday Morning Cup of Coffee: FICO execs say borrower credit keeps improving</div><div>
</div><div>Posted May 12, 2014 by Investors Unite</div><div>Housing Wire</div><div>
</div><div>May 12, 2014, By Ben Lane</div><div>
</div><div>Monday Morning Cup of Coffee takes a look at news crossing HousingWire’s weekend desk, with more coverage to come on bigger issues.</div><div>
</div><div>This week is likely to be another one that’s dominated by the release of significant reports that indicate the health (or lack thereof) of the housing market. Business Insider has a good rundown of everything to expect this week.</div><div>
</div><div>Full Article: Monday Morning Cup of Coffee: FICO execs say borrower credit keeps improving</div><div>
</div><div>Fannie, Freddie: Can’t Purge ‘Em? Merge ‘Em</div><div>
</div><div>Posted May 11, 2014 by Investors Unite</div><div>Wall Street Journal</div><div>
</div><div>May 11, 2014, By John Carney</div><div>
</div><div>The latest attempts to overhaul mortgage finance appear well on their way toward the final resting place of so many earlier efforts. Which is to say, perpetual limbo.</div><div>
</div><div>The logical next step to a stalled revamp, though, doesn’t have to be acceptance of the status quo. An alternative could be merging mortgage giants Fannie Mae FNMA +3.37% and Freddie Mac FMCC +3.41% into a single company.</div><div>
</div><div>View Article: Fannie, Freddie: Can’t Purge ‘Em? Merge ‘Em</div><div>
</div><div>Back to you, Mel …</div><div>
</div><div>Posted May 9, 2014 by Investors Unite</div><div>Politico</div><div>
</div><div>May 9, 2014, By Jon Prior</div><div>
</div><div>Since becoming the regulator of Fannie Mae and Freddie Mac in January, Mel Watt has kept a … low profile.</div><div>
</div><div>The former North Carolina congressman has given one formal speech, he hasn’t testified before Congress, and has granted no major media interviews.</div><div>
</div><div>Full Article: Back to you, Mel …</div><div>
</div><div>Fannie Mae And Freddie Mac Sending Treasury $10.2 Billion After Posting First Quarter Profits</div><div>
</div><div>Posted May 9, 2014 by Investors Unite</div><div>Forbes</div><div>
</div><div>May 9, 2014, by Maggie McGrath</div><div>
</div><div>Despite home prices that grew at a meager 0.4% rate during the first quarter of 2014, government-backed mortgage finance companiesFannie Mae and Freddie Mac were able to turn a profit during the quarter, albeit smaller profits than what they earned during the same time in 2013, the companies reported Thursday morning. And according to the terms set when the government bailed the mortgage siblings out of trouble in 2008, these profits are going straight into the hands of the U.S. Treasury.</div><div>
</div><div>Fannie Mae posted $5.3 billion in net income for the first quarter of 2014 and comprehensive income of $5.7 billion, the company’s ninth consecutive quarterly profit though a notable downturn from the $58.7 billion reported as net income in the year-ago period. The difference is largely attributable to a one-time accounting move that allowed Fannie Mae to apply losses from delinquent mortgages, though Fannie Mae CEO Tim Mayopoulos said in a Thursday morning conference call that the first quarter’s results were pressured by home prices.</div><div>
</div><div>Full Article: Fannie Mae And Freddie Mac Sending Treasury $10.2 Billion After Posting First Quarter Profits</div><div>
</div><div>Warren and Allies Said to Reject Fannie Mae Overhaul Bill</div><div>
</div><div>Posted May 9, 2014 by Investors Unite</div><div>Bloomberg</div><div>
</div><div>May 9, 2014, by Cheyenne Hopkins</div><div>
</div><div>Six Democrats whose support is crucial to a U.S. Senate plan to replace government-owned mortgage firms Fannie Mae and Freddie Mac (FMCC:US) have decided they won’t support the proposal without major revisions, dimming its chances of becoming law this year.</div><div>
</div><div>The lawmakers agreed in a private meeting yesterday that they wouldn’t support the bipartisan proposal to replace the finance companies with a government re-insurer, according to three people familiar with the meeting. A lack of Democratic consensus scuttled plans last week to approve the bill by the Senate Banking committee, whose chairman yesterday vowed to continue seeking votes.</div><div>
</div><div>View Article: Warren and Allies Said to Reject Fannie Mae Overhaul Bill</div><div>
</div><div>Small investors are caught up in fight over future of Fannie Mae, Freddie Mac</div><div>
</div><div>Posted May 9, 2014 by Investors Unite</div><div>Washington Post</div><div>
</div><div>May 9, 2014, by Dina ElBoghadady</div><div>
</div><div>Fannie Mae and Freddie Mac were left for dead after the government seized the mortgage giants in the midst of the 2008 financial crisis. Their stock tanked, and many shareholders fled.</div><div>
</div><div>Now the companies are flying high again, having cranked out more than $200?billion in profits, most of it in the past two years, as the housing market’s recovery took shape. D.C.-based Fannie and McLean, Va.-based Freddie reported Thursday an additional $9 billion in profits for the first quarter.</div><div>
</div><div>Full Article: Small investors are caught up in fight over future of Fannie Mae, Freddie Mac</div><div>
</div><div>Democrat “Gang Of Six” Say No To Housing Finance Overhaul (Johnson-Crapo)</div><div>
</div><div>Posted May 8, 2014 by Investors Unite</div><div>Confounded Interest</div><div>
</div><div>May 8, 2014, by Tony Sanders</div><div>
</div><div>Fannie Mae and Freddie Mac, the government mortgage giants, were placed into conservatorship back in 2008 by then FHFA Director James Lockhart. It is now 2014 and the best Congress (or at least the Senate) can come up with to replace Fannie Mae and Freddie Mac is Johnson-Crapo.</div><div>
</div><div>Johnson-Crapo is a compromise piece of legislation rather than an inspired design. It may have started as an inspired design, but the result is a hodgepodge of political compromises to attract dubious progressive Senators like the housing finance “Gang of Six” (Charles Schumer of New York, Sherrod Brown of Ohio, Jeff Merkley of Oregon, Robert Menendez of New Jersey, Elizabeth Warren of Massachusetts, and Jack Reed of Rhode Island).</div><div>
</div><div>Full Article: Democrat “Gang Of Six” Say No To Housing Finance Overhaul (Johnson-Crapo)</div><div>
</div><div>Eva Clayton was interviewed by Tim Boyum</div><div>
</div><div>Posted May 8, 2014 by Investors Unite</div><div>Capital Tonight</div><div>
</div><div>May 8, 2014</div><div>
</div><div>Eva Clayton was interviewed by Tim Boyum on Capital Tonight in North Carolina. Capital Tonight airs on Time Warner Cable affiliates throughout the state at 7pm and midnight.</div><div>
</div><div>Listen ToInterview: Eva Clayton was interviewed by Tim Boyum</div><div>
</div><div>Reform needed to avoid new crisis</div><div>
</div><div>Posted May 6, 2014 by Investors Unite</div><div>Dayton Daily News</div><div>
</div><div>May 6, 2014, by Loyal Blair </div><div>
</div><div>To prevent another housing crisis from occurring in the future, reform needs to be made, but I am dismayed at how recently proposed Fannie Mae and Freddie Mac reform legislation in the U.S. Senate completely disregards the rights of shareholders who are invested in the two companies.</div><div>
</div><div> In 2008, when the government injected 187.5 billion taxpayer dollars into Fannie and Freddie, the two companies were placed into conservator-ship. Under the agreement , Fannie and Freddie were required to pay a 10 percent dividend to the Treasury. But in August 2012, the government arbitrarily changed the agreement and began taking 100 percent of Fannie and Freddie profits.</div><div>
</div><div> This is shareholder money that belongs to individual retirees, veterans like myself, teachers, policemen, and people invested through mutual funds and others. Fannie and Freddie have paid back over $200 billion to the Treasury — more than was loaned to them.</div><div>
</div><div> What’s even more concerning is that our armed forces and veterans could get an even worse deal in this “reform” package. Mortgage foreclosure protections for service members are not written into the new legislation. Special programs for home modifications for disabled veterans could also fall through the cracks.</div><div>
</div><div> I hope that Senators Sherrod Brown and Rob Portman will work to amend this legislation.</div><div>
</div><div> LOYAL BLAIR, DAYTON</div><div>
</div><div>View Blair’s letter here: Reform needed to avoid new crisis </div><div>
</div><div>Overhaul Bill Criticized For Ending Affordable Housing Goals</div><div>
</div><div>Posted May 5, 2014 by Investors Unite</div><div>There’s a fight in Washington over the future of homeownership in America. At issue is a bipartisan bill to dramatically reshape the housing finance industry — the industry that was at the heart of the financial crisis. It’s also an industry that’s at the heart of the American dream — and the bill before Congress may affect who can afford to buy a house.</div><div>
</div><div>Read more – Overhaul Bill Criticized For Ending Affordable Housing Goals</div><div>
</div><div>The shortcomings of the Johnson-Crapo plan</div><div>
</div><div>Posted May 2, 2014 by Investors Unite</div><div>As the Senate Banking Committee considers the pending Johnson-Crapo housing finance reform bill, the bill has several fundamental shortcomings.</div><div>
</div><div>The current plan will continue the broad and deep government guarantee for virtually the entire housing market, a guarantee which is fraught with problems for the future. Government guarantees of all types have not performed well over their history. When the private sector puts their own capital at risk, they eventually have to correct and take their losses. The government has a history of accumulating losses and postponing corrective action. Market stability would be enhanced with the private sector in a position to take those losses instead of the taxpayer.</div><div>
</div><div>Read More – The shortcomings of the Johnson-Crapo plan</div><div>
</div><div>Tele-Press Conference: Investor Unite’s Tim Pagliara, Former U.S. Rep. Eva Clayton, Discussed Why Fannie & Freddie’s Failed Their Stress Test</div><div>
</div><div>Posted May 2, 2014 by Investors Unite</div><div> In Case You Missed It </div><div>
</div><div> Tele-Press Conference: </div><div>Investor Unite’s Tim Pagliara, Former U.S. Rep. Eva Clayton, Discussed Why Fannie & Freddie’s Failed Their Stress Test</div><div>
</div><div> U.S. Treasury’s Profit Sweep of Housing Giants Threatens Sustained Recovery </div><div>
</div><div>WASHINGTON, May 2, 2014 – Tim Pagiliara, Executive Director of Investors Unite and Eva Clayton, Former N.C. Congresswoman and former Assistant Director General of the UN Food and Agriculture Organization, discussed on a media teleconference yesterday that Fannie Mae and Freddie Mac had failed federally mandated stress tests due to the terms of the Third Amendment which has siphoned away $205 billion in profits. They emphasized how the 100% profit sweep undermines the recapitalization of the GSEs leaving shareholders empty handed, while threatening the recovery of the U.S. housing market. </div><div>
</div><div>Tim Pagliara </div><div>“What would have happened if the Third Amendment hadn’t been passed and the U.S. Government were only taking the 10% of profits they were entitled to? Fannie and Freddie would now have $50 billion worth of excess capital….Under the Third Amendment, they have had no ability to retain capital…In the last 14 months $205 billion was taken and has been earmarked toward deficit reduction.</div><div>
</div><div>“The stress test was an academic exercise meant to push the Administration’s agenda that Fannie and Freddie should be eliminated. It illustrates how outrageous and egregious the government and administration’s behaviors have become toward investors.” </div><div>
</div><div>Eva Clayton </div><div>“The stress tests revealed that even though the U.S. housing market has returned to good health, the Third Amendment has weakened these institutions…The Third Amendment runs counter to the support of affordable housing goals and leaves urban areas coming up on short side of the stick.”</div><div>
</div><div>Bios:</div><div>
</div><div>Tim Pagliara, Executive Director of Investors Unite and a shareholder invested in Fannie Mae and Freddie Mac. In a recent statement, Pagliara reiterated demand for an inclusive process.</div><div>
</div><div>Eva Clayton, former congresswoman from N.C., former Asst. Director General of the UN Food and Agriculture Organization. This week, Clayton spoke out against Johnson-Crapo for its failure to address affordable housing goals.</div><div>
</div><div>To listen to a recording of the call click here. </div><div>
</div><div>Contact Media@investorsunite.org for full transcript.</div><div>
</div><div> ###</div><div>
</div><div>About Investors Unite: Formed by Tennessee activist investor and CapWealth Advisors Chairman and CEO, Tim Pagliara, Investors Unite (www.investorsunite.org) is a coalition of private investors from all walks of life, committed to the preservation of shareholder rights for all invested in Fannie Mae and Freddie Mac. The coalition works to educate shareholders and lawmakers on the importance of adopting GSE reform that fully respects the legal rights of Fannie Mae and Freddie Mac shareholders and offers full restitution on investments. </div><div>
</div><div>P.O. Box 2591</div><div>Brentwood, TN 37024</div><div>
</div><div>The Irony Of A Fannie Mae And Freddie Mac Stress Test</div><div>
</div><div>Posted May 2, 2014 by Investors Unite</div><div>Seeking Alpha</div><div>
</div><div>May 2, 2014, by David Sims</div><div>
</div><div>This week, the FHFA provided results from a stress test at Fannie Mae (FNMA) and Freddie Mac (FMCC). The conclusion of the stress test was that in a worst case economic scenario the entities would need between $84.4 billion and $190 billion to cover expected losses. This is an absolute worst case scenario for them, one with 10% unemployment rates and double digit percentage drops in the stock market and housing prices. The irony of the situation is that the government has swept more than $200 billion off of the entities’ balance sheets through their net worth sweep, leaving them with practically no capital at all.</div><div>
</div><div>View Full Article: The Irony Of A Fannie Mae And Freddie Mac Stress Test</div><div>
</div><div>Pennsylvania’s community banks welcome reform done right</div><div>
</div><div>Posted May 2, 2014 by Investors Unite</div><div>Central Penn Business Journal</div><div>
</div><div>May 2, 2014, by Nick DiFrancesco</div><div>
</div><div>Pennsylvania’s economy is still rebounding from the collapse of the housing market in 2008. Though there is little doubt the effects of the housing crisis will continue to be felt for some time, there are indications that the housing market is making a comeback.</div><div>
</div><div>View DiFrancesco’s Letter Here: Pennsylvania’s community banks welcome reform done right </div><div>
</div><div>Crapo’s delayed housing finance reform plan draws critics</div><div>
</div><div>Posted May 2, 2014 by Investors Unite</div><div>Idaho Sen. Mike Crapo has temporarily delayed his bipartisan effort to overhaul the nation’s housing market. The plan, currently in Senate Banking Committee, would eventually eliminate Fannie Mae and Freddie Mac, two mortgage buying government sponsored entities that now are also mostly owned by the government. Crapo has called Fannie and Freddie the biggest unfinished …</div><div>
</div><div>Read more – Crapo’s delayed housing finance reform plan draws critics</div><div>
</div><div>Proposed Fannie, Freddie reforms unfair to shareholders</div><div>
</div><div>Posted April 30, 2014 by Investors Unite</div><div>The Tennessean</div><div>
</div><div>April 30, 2014, by Daniel Hutcheson</div><div>
</div><div>When America faces dire economic challenges, it turns to its citizens for support. In 2008, the federal government encouraged investment in Fannie Mae and Freddie Mac. My wife and I wanted to help and also viewed it as a sound investment.</div><div>
</div><div>Now, the Treasury and pending proposals in the Senate, including from Sen. Bob Corker, threaten our investment and rights as shareholders. They codify a 100 percent taking of the dividends for the Treasury — even after the taxpayers have been repaid completely — including interest.</div><div>
</div><div>View Full Article: Proposed Fannie, Freddie reforms unfair to shareholders</div><div>
</div><div>Investors Unite: Delay in Johnson Crapo legislation presents opportunity for real reform that would include investor input</div><div>
</div><div>Posted April 29, 2014 by Investors Unite</div><div>
</div><div>Print</div><div>
</div><div>April 29, 2014For Immediate Release</div><div>Contact: Media@Investorsunite.org</div><div>NASHVILLE, TN – Following news today that Johnson-Crapo housing finance bill markup has stalled, Tim Pagliara, head of Investors Unite issued the following statement:</div><div>
</div><div> “Today’s decision by the Senate Banking Committee to delay the mark-up of the much touted reform legislation is indicative of the deep flaws in this legislation, which would codify the government’s attempt to wipe out investors in Fannie and Freddie, raise the cost of mortgages and add to our national debt.”</div><div>“It’s interesting to note that this delay happened despite energetic lobbying for the bill by Secretary Donovan, who has recently made assurances that the bill would not raise the cost of mortgages or impact mortgage availability and affordability. It will in fact raise the cost of mortgages and limit availability, as Moody’s and many other major analyses have reported. Our position is consistent with not only the understanding of most of the mortgage and finance community, but with constitutional and business law scholars as well. Under current proposals, everyone loses: investors, creditors and indeed the broader US economy itself in a society in which the rule of law has been diminished.</div><div>
</div><div>“Investors from across America have been excluded in this process until now. We’re the only stakeholder group that has not been included in the process, and we’re hoping to work with members of the Senate Banking Committee on a bill that protects home affordability, protects investor rights and does not experiment with one-sixth of our economy.”</div><div>
</div><div> ###</div><div>
</div><div>About Investors Unite: Formed by Tennessee activist investor and CapWealth Advisors Chairman and CEO, Tim Pagliara, Investors Unite (www.investorsunite.org) is a coalition of private investors from all walks of life, committed to the preservation of shareholder rights for all invested in Fannie Mae and Freddie Mac. The coalition works to educate shareholders and lawmakers on the importance of adopting GSE reform that fully respects the legal rights of Fannie Mae and Freddie Mac shareholders and offers full restitution on investments. </div><div>Fannie and Freddie reform–the right way</div><div>
</div><div>Posted April 29, 2014 by Investors Unite</div><div>The Hill</div><div>
</div><div>April 29, 2014, by Tim Pagliara</div><div>
</div><div>With Congress poised to begin marking up legislation to reform mortgage giants Fannie Mae and Freddie Mac by the end of the month, more and more Fannie and Freddie investors have learned exactly what that means for their pensions and personal investments. And what are those investors being told? That Fannie and Freddie are going away and stock held by firefighters, police, school teachers, community banks, pensioners and individual investors will amount to nothing more than worthless paper.</div><div>
</div><div>The Federal government used $187.5 billion taxpayer dollars to keep the Government Sponsored Enterprises (GSEs) afloat and placed them into conservatorship at the height of the financial crisis in 2008. The government held to its original conservatorship agreement until August 2012 when it arbitrarily decided to change the rules in midstream with an amendment that diverted 100 percent of Fannie and Freddie¹s profits to the Treasury¹s coffers, effectively wiping out private investors. Some of the investors who had their dividend swept away were invested in the GSEs years before the conservatorship took effect; some people had invested around the outset of the conservatorship and some had invested a few years after.</div><div>
</div><div>View Full Article: Fannie and Freddie reform–the right way</div><div>
</div><div>Corker’s bill sparks rare political alliances in opposition</div><div>
</div><div>Posted April 29, 2014 by Investors Unite</div><div>Gannett</div><div>
</div><div>April 29, 2014, by Paul C. Barton</div><div>
</div><div>WASHINGTON — Sen. Bob Corker’s ideas for remaking the housing finance system have upset some usual political alliances.</div><div>
</div><div>For starters, a coalition of tea party groups, hedge fund investors and consumer advocate Ralph Nader, a trio not normally known for working together, fiercely oppose some of his housing proposals, which are now before the Senate Committee on Banking, Housing and Urban Affairs.</div><div>
</div><div>And the debate has laid bare, through emails, differences between Corker and a prominent Tennessee Republican who also happens to be one of the senator’s past political donors as well as a past bundler of campaign contributions – Tim Pagliara.</div><div>
</div><div>View Full Article: Corker’s bill sparks rare political alliances in opposition</div><div>
</div><div>Congressional GSE Reform Is Dead In 2014</div><div>
</div><div>Posted April 29, 2014 by Investors Unite</div><div>Seeking Alpha</div><div>
</div><div>April , 2014, by David Sims</div><div>
</div><div>The good news for Fannie Mae (OTCQB:FNMA) and Freddie Mac (OTCQB:FMCC) shareholders arrived this morning; the Johnson-Crapo Bill would not be marked up and not go through the process of counting votes for or against. This was the last opportunity to get the bill out of the Senate Banking Committee in 2014, before the election cycle begins.</div><div>
</div><div>This means that there is no meaningful legislation that will be passed in the next few months out of either the House or Senate. The most pertinent news driving the stocks will be each company’s earnings and the outcome of discovery in several of the lawsuits against the government, filed by shareholders.</div><div>
</div><div>View Full Article: Congressional GSE Reform Is Dead In 2014</div><div>
</div><div>Bill would be bad for stockholders</div><div>
</div><div>Posted April 29, 2014 by Investors Unite</div><div>Daily Commet</div><div>
</div><div>April 29, 2014, by Michael Mitternight</div><div>
</div><div>Louisiana is finally beginning a slow recovery from the housing crisis of a few years ago.</div><div>
</div><div>Unfortunately, just as things start to improve, some elected officials in Washington, D.C., are pushing legislation that could have a detrimental effect on that upswing.</div><div>
</div><div>Proposed legislation by Sens. Tim Johnson, D-N.D., and Mike Crapo, R-Idaho, the Johnson-Crapo Bill, is well-intended to offer reform to two government sponsored enterprises, Fannie Mae and Freddie Mac.</div><div>
</div><div>I agree some manner of reform is probably a good thing.</div><div>
</div><div>View Full Article: Bill would be bad for stockholders</div><div>
</div><div>Fannie and Freddie reform–the right way</div><div>
</div><div>Posted April 29, 2014 by Investors Unite</div><div>By Tim Pagliara</div><div>
</div><div>With Congress poised to begin marking up legislation to reform mortgage giants Fannie Mae and Freddie Mac by the end of the month, more and more Fannie and Freddie investors have learned exactly what that means for their pensions and personal investments. And what are those investors being told? That Fannie and Freddie are going away and stock held by firefighters, police, school teachers, community banks, pensioners and individual investors will amount to nothing more than worthless paper.</div><div>
</div><div>The Federal government used $187.5 billion taxpayer dollars to keep the Government Sponsored Enterprises (GSEs) afloat and placed them into conservatorship at the height of the financial crisis in 2008. The government held to its original conservatorship agreement until August 2012 when it arbitrarily decided to change the rules in midstream with an amendment that diverted 100 percent of Fannie and Freddie¹s profits to the Treasury¹s coffers, effectively wiping out private investors. Some of the investors who had their dividend swept away were invested in the GSEs years before the conservatorship took effect; some people had invested around the outset of the conservatorship and some had invested a few years after.</div><div>
</div><div>After hearing outrage from Fannie Mae and Freddie Mac investors from across the country, I decided to organize a group to visit Washington last week to meet with our elected representatives. Our message to lawmakers was simple: Washington must reform the GSEs in such a way that shareholders are paid what they are contractually and legally owed — something that the currently proposed legislation put forth by members of the Senate Banking Committee fails to do.</div><div>
</div><div>View full text of this article: Fannie and Freddie reform–the right way </div><div>
</div><div>Jonathan Macey and Logan Beirne: Stealing Fannie and Freddie</div><div>
</div><div>Posted April 28, 2014 by Investors Unite</div><div>Federalist Society</div><div>
</div><div>By Jonathan Macey</div><div>
</div><div>Jonathan R. Macey–Sam Harris Professor of Corporate Law, Corporate Finance and Securities Law, Yale Law School–and Logan Beirne, visiting fellow at Yale Law School’s Informational Society– have published a working paper titled “Stealing Fannie and Freddie.” According to its abstract:</div><div>
</div><div>“The housing market accounts for nearly 20 percent of the American economy, so it is critical that we have a strong and stable housing finance system that is built to last,” declares the Senate Banking Committee Leaders’ Bipartisan Housing Finance Reform Draft. The proposed legislation’s first step towards this laudable goal, however, is to liquidate the government-sponsored enterprises Fannie Mae and Freddie Mac – in defiance of the rule of law. This paper analyzes the current House and Senate housing finance reform proposals and faults their modes of liquidation for departing from legal norms, thereby harming investors and creditors, taxpayers, and the broader economy.</div><div>
</div><div>Under proposals before Congress, virtually everyone loses. First, the GSEs’ shareholders’ property rights are violated. Second, taxpayers face the potential burden of the GSEs’ trillions in liabilities without dispensing via the orderly and known processes of a traditional bankruptcy proceeding or keeping the debts segregated as the now-profitable GSEs seek to pay them down. Finally, the rule of law is subverted, thereby making lending and business in general a riskier proposition when the country and global economy are left to the political whims of the federal government.</div><div>
</div><div>View full paper: Jonathan Macey and Logan Beirne: Stealing Fannie and Freddie</div><div>
</div><div>Fannie, Freddie say overhaul would boost mortgage rates</div><div>
</div><div>Posted April 28, 2014 by Investors Unite</div><div>Wall Street Journal</div><div>
</div><div>April 28, 2014</div><div>By Nick Timiraos</div><div>
</div><div>Ahead of a key Senate vote scheduled for this week on a bill to replace Fannie Mae and Freddie Mac, the companies outlined concerns about the bill in detailed memos distributed to lawmakers on Friday.</div><div>
</div><div>Fannie and Freddie, which were taken over by the U.S. in 2008, haven’t been allowed to lobby. But the Treasury Department, which injected nearly $188 billion to keep the companies afloat, asked the companies to provide technical input on the Senate bill, which the White House supports.</div><div>
</div><div>View Full Article: Fannie, Freddie say overhaul would boost mortgage rates</div><div>
</div><div>Fannie Mae Stockholders: Fasten Your Seat Belts Please, Major Catalyst Is Approaching</div><div>
</div><div>Posted April 28, 2014 by Investors Unite</div><div>Seeking Alpha</div><div>
</div><div>April 28, 2014</div><div>
</div><div>Fannie Mae and Freddie Mac continue to be extremely interesting investments with asymmetric payoff profiles. News about the government-owned entities have been sparse lately, but both companies are facing a vital deadline which is likely to have extraordinary consequences for the share prices of both companies.</div><div>
</div><div>On April 29, 2014 a panel of the Senate Banking Committee will hold a markup hearing that will give vital clues to stockholders about how Capitol Hill will pursue the restructuring of the mortgage finance market (see here for legislative details of the Johnson/Crapo reform bill). The current proposal basically suggests a wind-down of the GSEs, which, naturally is not good news for common stockholders. Similarly, a bipartisan agreement on the reform proposal and on actual measures to push the reform bill through the House and the Senate are bad news for common shareholders.</div><div>
</div><div>View full article: Fannie Mae Stockholders: Fasten Your Seat Belts Please, Major Catalyst Is Approaching</div><div>
</div><div>Corker speaks out on mortgage lending</div><div>
</div><div>Posted April 28, 2014 by Investors Unite</div><div>The Tennessean</div><div>
</div><div>April 28, 2014</div><div>By Paul Barton</div><div>
</div><div>In trying to revamp how Americans finance their homes, key to about 20 percent of the U.S. economy, Sen. Bob Corker knows he has stepped into a special-interest minefield. Forces on all sides rank among the nation’s most powerful lobbying interests and campaign contributors.</div><div>
</div><div>Corker, R-Tenn., has been working for nearly a year to garner support for legislation to make mortgage lending more dependent on private capital and less on the federal government. He would put out of business, within five years, the two government-sponsored entities that fuel most mortgage lending now: the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac).</div><div>
</div><div>View Full Article: Corker speaks out on mortgage lending</div><div>
</div><div>Fannie and Freddie on Steroids</div><div>
</div><div>Posted April 28, 2014 by Investors Unite</div><div>National Review</div><div>
</div><div>Monday, April 28, 2014</div><div>By John Berlau</div><div>
</div><div>A corollary to Shakespeare’s adage “A rose by any other name would smell as sweet” is that “garbage by any other name would smell as awful.”</div><div>
</div><div>The latter seems apropos to the “reform” of the government-sponsored housing enterprises, Fannie Mae and Freddie Mac, introduced by senators Tim Johnson, (D., S.D), and Mike Crapo, (R., Idaho) — the top Democrat and Republican on the Senate Banking Committee — and set to be marked up on Tuesday. A new letter signed by 26 conservative and free-market groups — including the Competitive Enterprise Institute, Club for Growth, FreedomWorks, Americans for Tax Reform, National Taxpayers Union, and the American Family Association — argues that Johnson-Crapo “does not constitute real reform, but an expansion of the type of government intervention that fueled the housing crisis in the first place.”</div><div>
</div><div>View full article: Fannie and Freddie on Steroids</div><div>
</div><div>Letter: Bills would alter American dream</div><div>
</div><div>Posted April 27, 2014 by Investors Unite</div><div>The Columbian</div><div>
</div><div>April 27, 2014, by Mike Davis</div><div>
</div><div>Letter: Bills would alter American dream</div><div>
</div><div>Members of the Senate banking committee are introducing bills to wind down Fannie Mae and Freddie Mac. These bills eliminate these institutions that provide the American taxpayers affordable interest mortgage loans and housing market stability. This will cause higher mortgage interest rates, affecting 20 percent of the economy. It also funds “affordable” housing, another attempt of redistributing wealth.</div><div>
</div><div>In 2008, the treasury backed FNMA and FMCC with $187 billion, as the “too big to fail” banks sold fraudulent assets to FNMA and FMCC. They have since paid back the Treasury more than $200 billion. The treasury will not release FNMA and FMCC from conservatorship, contrary to their 2008 agreement. In 2012, the Treasury changed the agreement to take 100 percent of their profits.</div><div>
</div><div>View Full Article: Letter: Bills would alter American dream</div><div>
</div><div>Johnson-Crapo GSE Reform Bill Met With More Resistance</div><div>
</div><div>Posted April 24, 2014 by Investors Unite</div><div>National Mortgage Professional</div><div>
</div><div>April 23, 2014</div><div>
</div><div>The Competitive Enterprise Institute (CEI), in a coalition of 26 public policy leaders, sent a letter to members of the Senate Banking Committee urging them to reject the latest effort to overhaul the U.S. housing-finance system, which would expand government involvement in the housing market. The Johnson-Crapo bill is scheduled to be marked up by the committee on April 29.</div><div>
</div><div>“Today, we urge Senate Banking Committee members to reject Johnson-Crapo,” said CEI senior fellow John Berlau. “Johnson-Crapo is not reform, but an expansion of the type of government intervention that fueled the housing crisis in the first place. Real reform must focus on restoring the private housing market by reducing both subsidies and overregulation from laws such as the Dodd-Frank Act.”</div><div>
</div><div>Specifically, the coalition opposes Johnson-Crapo’s plan to replace Freddie Mac and Fannie Mae with a new federal entity, the Federal Mortgage Insurance Corporation, which would explicitly guarantee trillions of dollars in mortgages and put millions of taxpayers at risk.</div><div>
</div><div>View Full Article: Johnson-Crapo GSE Reform Bill Met With More Resistance</div><div>
</div><div>Housing Prices Rise, New Home Sales Fall, Earnings Loom</div><div>
</div><div>Posted April 24, 2014 by Investors Unite</div><div>Seeking Alpha</div><div>
</div><div>April 24, 2014</div><div>By David Sims</div><div>
</div><div>Shareholders have been speaking out recently, due to the fact that Fannie and Freddie have now created a solid profit for taxpayers. They believe it is time for the Rule of Law to be restored and shareholders to begin participating as business partners in these entities operations.</div><div>
</div><div>Meanwhile some weakness appears to be showing in other housing data. Existing home sales came in slightly lower than expected on Tuesday at 4.59 million units, but new home sales were well below expectations dropping to 384,000 versus expectations of 455,000 in reports released Wednesday.</div><div>
</div><div>Mortgage insurers like MGIC Investment Corp. (MTG) and Radian Group Inc. (RDN) should perform well with continued increases in home prices. Based on expected future results, both companies trade at very decent earnings multiples of about ten and eleven times forward earnings. Radian is expected to report 1st Quarter earnings soon.</div><div>
</div><div>View full article: Housing Prices Rise, New Home Sales Fall, Earnings Loom</div><div>
</div><div>Should Uncle Sam really be subsidizing the American Dream?</div><div>
</div><div>Posted April 23, 2014 by Investors Unite</div><div>Housing Wire</div><div>
</div><div>April 23, 2014</div><div>By Trey Garrison</div><div>
</div><div>It may sound like heresy to some in the industry, but Catherine Rampell has a point in the Washington Post today – a home is not a good investment.</div><div>
</div><div>Calm down. That comes with a caveat – it’s not a good investment as an investment.</div><div>
</div><div>View full article: Should Uncle Sam really be subsidizing the American Dream?</div><div>
</div><div>KIDO Tim Pagiliara Interview</div><div>
</div><div>Posted April 23, 2014 by Investors Unite</div><div>April 23, 2014</div><div>
</div><div>Radio Interview</div><div>
</div><div>Lobbying on housing finance bill focuses on three senators</div><div>
</div><div>Posted April 22, 2014 by Investors Unite</div><div>Politico</div><div>
</div><div>April 22, 2014</div><div>By Jon Prior</div><div>
</div><div>Supporters of the Senate Banking Committee’s plan to overhaul the housing finance market are now focusing on winning the votes of three senior Democratic members on the panel, believing that progressives on the committee are unlikely to support the proposal without major changes.</div><div>
</div><div>The committee is set to begin considering the bill on April 29 and the goal of committee leaders and Obama administration officials is to grow support for the proposal beyond the 12 panel members — six Democrats, six Republicans — who are expected to vote in favor of the legislation in hopes that will increase the chances of getting a floor vote this year.</div><div>
</div><div>View full article: Lobbying on housing finance bill focuses on three senators</div><div>
</div><div>ABA Offers Fixes to Senate Banking GSE Bill</div><div>
</div><div>Posted April 22, 2014 by Investors Unite</div><div>April 18, 2014</div><div>
</div><div>By Victoria Finkle</div><div>
</div><div>The American Bankers Association recommended several fixes Thursday for the mortgage overhaul bill pending in the Senate Banking Committee.</div><div>
</div><div>The letter comes ahead of a scheduled April 29 vote on the bill, which was unveiled by Sens. Tim Johnson, D-S.D., chairman of the banking panel, and Mike Crapo of Idaho, its ranking Republican, last month. The bipartisan plan would unwind government-sponsored enterprises Fannie Mae and Freddie Mac and establish a private secondary market backed by a government guarantee in the event of catastrophic losses.</div><div>
</div><div>View full article: ABA Offers Fixes to Senate Banking GSE Bill</div><div>
</div><div>Ralph Nader predicts survival of Fannie Mae and Freddie Mac</div><div>
</div><div>Posted April 22, 2014 by Investors Unite</div><div>Washington Examiner</div><div>
</div><div>April 18, 2014</div><div>By Joseph Lawler</div><div>
</div><div>Long-time consumer advocate and perennial presidential candidate Ralph Nader predicts that bailed-out mortgage businesses Fannie Mae and Freddie Mac will survive legislative attempts to disband them.</div><div>
</div><div>That would be a good outcome in Nader’s view. He has become the improbable spokesman for a group that advocates for Fannie and Freddie shareholders and opposes a reform bill taking shape in the Senate — a diverse crew that also includes several hedge funds that would not typically be allied with Nader.</div><div>
</div><div>View full article: Ralph Nader predicts survival of Fannie Mae and Freddie Mac</div><div>
</div><div>Wall Street Journal Publishes Commentary on Johnson-Crapo</div><div>
</div><div>Posted April 21, 2014 by Investors Unite</div><div>The Banking Law Connection</div><div>
</div><div>April 21, 2014</div><div>By Joseph “Woody” A Woodruff</div><div>
</div><div>In case you were looking for a short primer on the merits of the Senate Banking Committee’s contemplated overhaul of America’s mortgage-lending industry, the Johnson-Crapo bill, you can find it in a recent headline. The April 17 Wall Street Journal carries an Op-Ed piece authored by former Banking Committee Chair Phil Graham and AEI Fellow, Peter Wallison. The Journal’s headline for Graham and Wallison’s article is Worse Than Fannie and Freddie.</div><div>
</div><div>View full article: Wall Street Journal Publishes Commentary on Johnson-Crapo</div><div>
</div><div>Fannie and Freddie 2.0: The Senate Does Not Get the Government Out of the Market</div><div>
</div><div>Posted April 18, 2014 by Investors Unite</div><div>The Heritage Foundation</div><div>
</div><div>April 18, 2014</div><div>By John Ligon & Norbert Michel</div><div>
</div><div>In an effort to reform the nation’s housing finance system, Senate Banking Committee Chairman Tim Johnson (D–SD) and ranking member Mike Crapo (R–ID) have announced that they will hold a markup for their bill on April 29, but many details still have to be ironed out.</div><div>
</div><div>Given that close to 100 percent of the U.S. mortgage market is now backed by the federal government, it is good that the Senate Banking Committee wants to improve the Johnson–Crapo proposal. However, the approach being taken by Johnson–Crapo and a similar bill by Senators Bob Corker (R–TN) and Mark Warner (D–VA) would ensure that U.S. mortgage markets are slightly remodeled rather than completely reformed. The government would be at least as involved in these markets as it was prior to the 2008 crash.</div><div>
</div><div>View full article: Fannie and Freddie 2.0: The Senate Does Not Get the Government Out of the Market</div><div>
</div><div>Ralph Nader predicts survival of Fannie Mae and Freddie Mac</div><div>
</div><div>Posted April 18, 2014 by Investors Unite</div><div>Washington Examiner</div><div>
</div><div>April 18, 2014</div><div>By Joseph Lawler</div><div>
</div><div>Long-time consumer advocate and perennial presidential candidate Ralph Nader predicts that bailed-out mortgage businesses Fannie Mae and Freddie Mac will survive legislative attempts to disband them.</div><div>
</div><div>That would be a good outcome in Nader’s view. He has become the improbable spokesman for a group that advocates for Fannie and Freddie shareholders and opposes a reform bill taking shape in the Senate — a diverse crew that also includes several hedge funds that would not typically be allied with Nader.</div><div>
</div><div>View full article: Ralph Nader predicts survival of Fannie Mae and Freddie Mac</div><div>
</div><div>Banking Industry Has Connections to Shape Mortgage Overhaul</div><div>
</div><div>Posted April 18, 2014 by Investors Unite</div><div>Open Secretes</div><div>
</div><div>April 18, 2014</div><div>By Robbie Feinberg</div><div>
</div><div>This month, the Senate Banking Committee is set to consider a bill to overhaul the mortgage finance system, most notably by getting rid of the government-owned mortgage giants Fannie Mae and Freddie Mac over five years.</div><div>
</div><div>That would significantly shift the risks of mortgages, as well as the entire mortgage market, away from the government and toward the private sector. And with a wealth of lobbying cash as well as connections with the bill’s crafters, the financial sector (including the insurance and banking industries) could play a serious role in shaping how those risks and rewards turn out in the final legislation.</div><div>
</div><div>The proposed measure, from Senate Banking Committee chairman Tim Johnson (D-S.D.) and ranking member Mike Crapo (R-Idaho), would extinguish Fannie and Freddie and create a body called the Federal Mortgage Insurance Corporation to regulate a new insurance system for mortgage bonds. The new system would make lenders accountable for the first 10 percent of potential losses on mortgage bonds, with the government liable for the rest.</div><div>
</div><div>View full article: Banking Industry Has Connections to Shape Mortgage Overhaul</div><div>
</div><div>Johnson Crapo GSE Discussion Draft A Few Suggestions for Improvement</div><div>
</div><div>Posted April 17, 2014 by Investors Unite</div><div>Urban Institute</div><div>
</div><div>April 17, 2014</div><div>By Laurie Goodman, Ellen Seidman</div><div>
</div><div>Over the past several years, a consensus has developed on the goals of GSE Reform: preserve the liquidity of the mortgage market while protecting the taxpayer by putting private capital in a first loss position, retain wide access to long-term fixed rate mortgages, provide access and equity for lenders of all sizes, and support affordable housing. Senators Tim Johnson (D-SD) and Mike Crapo (R-ID) released new draft legislation in March 2014 striving to achieve these goals. While this bipartisan proposal is a major step forward for housing finance reform, we suggest improvements in two critical areas: the structure of the private capital in the first loss position and the affordable housing incentive fee provisions. In both cases, the system as proposed has intellectual appeal, but is apt to have unintended and undesirable consequences.</div><div>
</div><div>View full article: Johnson Crapo GSE Discussion Draft A Few Suggestions for Improvement</div><div>
</div><div>Small Lenders Fear GSE Reform Bill Could Endanger Them</div><div>
</div><div>Posted April 16, 2014 by Investors Unite</div><div>American Banker</div><div>
</div><div>April 16, 2014</div><div>By Brian Collins</div><div>
</div><div>A landmark housing finance bill has brought back mortgage bankers’ old fears about “mission creep” by secondary market players. Only this time, they fear large banks, not Fannie Mae and Freddie Mac, would be doing the creeping.</div><div>
</div><div>Small lenders are concerned the bill to wind down Fannie and Freddie, drafted by Senate Banking Committee Chairman Tim Johnson, D-S.D., and Sen. Mike Crapo, R-Idaho, would allow giant banks to play multiple roles in the new mortgage market — potentially pricing smaller companies out of the business.</div><div>
</div><div>View full article: Small Lenders Fear GSE Reform Bill Could Endanger Them</div><div>
</div><div>VIDEO: Nader: Paulson, Bernanke Deceived Shareholders</div><div>
</div><div>Posted April 16, 2014 by Investors Unite</div><div>Bloomberg</div><div>
</div><div>April 16, 2014</div><div>
</div><div>Consumer Advocate Ralph Nader discusses the plight of Fannie Mae and Freddie Mac shareholders in the wake of the U.S. financial crisis. He speaks on Bloomberg Television’s “Market Makers.”</div><div>
</div><div>View video Nader: Paulson, Bernanke Deceived Shareholders</div><div>
</div><div>Senate Banking Leaders May Delay Vote on GSE Reform</div><div>
</div><div>Posted April 15, 2014 by Investors Unite</div><div>American Banker</div><div>
</div><div>April 14, 2014</div><div>By Victoria Finkle</div><div>
</div><div>The Senate Banking Committee is scheduled to vote on its bill to overhaul the mortgage finance market on April 29, but questions are now being raised about whether that date will slip, as supporters struggle to secure additional votes.</div><div>
</div><div>Chairman Tim Johnson, D-S.D., and Sen. Mike Crapo, the lead Republican, are said to be trying to attract as many as four more votes, bringing the tally up to 16 supporters, but those numbers are proving difficult to come by. The situation has even sparked rumors about whether the original coalition of committee members from both political parties remains intact.</div><div>
</div><div>View full article: http://www.americanbanker.com/issues/179_72/senate-banking-leaders-may-delay-vote-on-gse-reform-1066876-1.html</div><div>
</div><div>Housing industry asks $5 trillion question: what does Watt want?</div><div>
</div><div>Posted April 14, 2014 by Investors Unite</div><div>Reuters</div><div>
</div><div>April 14, 2014</div><div>By Margaret Chadbourn</div><div>
</div><div>The U.S. housing industry has waited three months to find out how Mel Watt will govern taxpayer-owned mortgage companies Fannie Mae (FNMA.OB) and Freddie Mac (FMCC.OB), and have been frustrated by his silence.</div><div>
</div><div>The former 11-term congressman from North Carolina, who took over the agency that oversees the two enterprises in January, has not delivered an annual strategic plan, which would usually be public by now.</div><div>
</div><div>View full article: Housing industry asks $5 trillion question: what does Watt want?</div><div>
</div><div>Vanquished Fannie Mae & Freddie Mac Shareholders Take to Capitol Hill to Demand Fair Treatment</div><div>
</div><div>Posted April 11, 2014 by Investors Unite</div><div>FOR IMMEDIATE RELEASE</div><div>media@investorsunite.org </div><div>April 11, 2014</div><div>
</div><div>Vanquished Fannie Mae & Freddie Mac Shareholders Take to Capitol Hill to Demand Fair Treatment </div><div>Spearheaded by Tim Pagliara, Investors Unite coalition stages first action, bringing abused GSE investors from 18 states to meet with lawmakers</div><div>
</div><div>(WASHINGTON, D.C. – April 11, 2014) Under the banner of the newly formed Investors Unite coalition, some 50 vanquished Fannie Mae and Freddie Mac shareholders from 18 states and from all walks of life descended on Capitol Hill for a press conference at the National Press Club and meetings with key Senate and House legislators and staff to demand enactment of GSE reform that would restore shareholder rights. </div><div>
</div><div>The coalition, which advocates for the rights of GSE shareholders, was spearheaded by a Fannie and Freddie investor from Nashville, Tim Pagliara, CEO CapWealth Advisors. Pagliara has been a vocal opponent of his own Senator Bob Corker’s draft GSE reform proposal (the Corker-Warner bill) and the subsequent Crapo-Johnson proposal that would codify the U.S. Treasury’s “net-worth sweep” of Fannie and Freddie dividends.</div><div>
</div><div>The press conference featured remarks by Pagliara and shareholders, along with a statement of support from famed consumer advocate Ralph Nader, whose Shareholder Respect has advocated for GSE reform that avoids pitting taxpayers against shareholders.</div><div>
</div><div>“We’re here today to show you the faces of the Fannie and Freddie investors, who have been miscast as only institutional investors and large hedge funds,” said Pagliara. “We are here to tell Congress that they must uphold the rule of law and respect shareholder rights as lawmakers seek GSE reform.” </div><div>
</div><div>“Our laws were designed to protect the individual investor. It’s one of the most fundamental principles of our market economy: investor rights. And according to the law, there is no distinction between ‘big investors’ and ‘small ones.’ All are guaranteed equal protection. When that principle is subverted, it’s dangerous for our economy.”</div><div>
</div><div>Pagliara joined forces with Nader earlier this year at a Shareholder Respect forum that brought together affordable housing advocates with institutional investors to protest the government’s illegal takings of Fannie and Freddie profits. Subsequently, Pagliara received emails and calls from individual investors across the country urging collective action.</div><div>
</div><div>In 48 meetings conducted April 9, with Members of Congress and legislative staff, GSE shareholders explained the often devastating impact of the U.S. Treasury’s “net-worth sweep” of their stock dividends – a scenario that would be codified by the Johnson-Crapo proposal, which will be “marked-up” in the Senate Banking Committee later this month.</div><div>
</div><div>Among five investors who made statements at the National Press Club, Haran Kumar, an IT professional from Atlanta stated, “I believed my investment in Fannie stock was a sound decision — because of the statements made by politicians and the laws protecting these investments,” he said. “None of us are saying don’t reform the housing sector. We are saying: do it appropriately; respect the laws that Congress itself has enacted!”</div><div>
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</div><div>About Investors Unite: Formed by Tennessee activist investor and CapWealth Advisors Chairman and CEO, Tim Pagliara, Investors Unite (www.investorsunite.org) is a coalition of private investors from all walks of life, committed to the preservation of shareholder rights for all invested in Fannie Mae and Freddie Mac. The coalition works to educate shareholders and lawmakers on the importance of adopting GSE reform that fully respects the legal rights of Fannie Mae and Freddie Mac shareholders and offers full restitution on investments. </div><div>
</div><div> </div><div>
</div><div>P.O. Box 2591</div><div>Brentwood, TN 37024</div><div>
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</div><div>Vanquished Fannie Mae & Freddie Mac Shareholders Take to Capitol Hill to Demand Fair Treatment</div><div>
</div><div>Posted April 11, 2014 by Investors Unite</div><div>For Immediate Release</div><div>Contact: media@investorsunite.org</div><div>
</div><div>Vanquished Fannie Mae & Freddie Mac Shareholders Take to Capitol Hill to Demand Fair Treatment</div><div>Spearheaded by Tim Pagliara, Investors Unite coalition stages first action, bringing abused GSE investors from 18 states to meet with lawmakers </div><div>
</div><div> (WASHINGTON, D.C. – April 11, 2014) Under the banner of the newly formed Investors Unite coalition, some 50 vanquished Fannie Mae and Freddie Mac shareholders from 18 states and from all walks of life descended on Capitol Hill for a press conference at the National Press Club and meetings with key Senate and House legislators and staff to demand enactment of GSE reform that would restore shareholder rights.</div><div>
</div><div>The coalition, which advocates for the rights of GSE shareholders, was spearheaded by a Fannie and Freddie investor from Nashville, Tim Pagliara, CEO CapWealth Advisors. Pagliara has been a vocal opponent of his own Senator Bob Corker’s draft GSE reform proposal (the Corker-Warner bill) and the subsequent Crapo-Johnson proposal that would codify the U.S. Treasury’s “net-worth sweep” of Fannie and Freddie dividends.</div><div>
</div><div>The press conference featured remarks by Pagliara and shareholders, along with a statement of support from famed consumer advocate Ralph Nader, whose Shareholder Respect has advocated for GSE reform that avoids pitting taxpayers against shareholders.</div><div>
</div><div>“We’re here today to show you the faces of the Fannie and Freddie investors, who have been miscast as only institutional investors and large hedge funds,” said Pagliara. “We are here to tell Congress that they must uphold the rule of law and respect shareholder rights as lawmakers seek GSE reform.”</div><div>
</div><div>“Our laws were designed to protect the individual investor. It’s one of the most fundamental principles of our market economy: investor rights. And according to the law, there is no distinction between ‘big investors’ and ‘small ones.’ All are guaranteed equal protection. When that principle is subverted, it’s dangerous for our economy.”</div><div>
</div><div>Pagliara joined forces with Nader earlier this year at a Shareholder Respect forum that brought together affordable housing advocates with institutional investors to protest the government’s illegal takings of Fannie and Freddie profits. Subsequently, Pagliara received emails and calls from individual investors across the country urging collective action.</div><div>
</div><div>In 48 meetings conducted April 9, with Members of Congress and legislative staff, GSE shareholders explained the often devastating impact of the U.S. Treasury’s “net-worth sweep” of their stock dividends – a scenario that would be codified by the Johnson-Crapo proposal, which will be “marked-up” in the Senate Banking Committee later this month.</div><div>
</div><div>Among five investors who made statements at the National Press Club, Haran Kumar, an IT professional from Atlanta stated, “I believed my investment in Fannie stock was a sound decision — because of the statements made by politicians and the laws protecting these investments,” he said. “None of us are saying don’t reform the housing sector. We are saying: do it appropriately; respect the laws that Congress itself has enacted!”</div><div>
</div><div>About Investors Unite: Formed by Tennessee activist investor and CapWealth Advisors Chairman and CEO Tim Pagliara, Investors Unite(www.investorsunite.org) is a coalition of private investors from all walks of life, committed to the preservation of shareholder rights for all invested in Fannie Mae and Freddie Mac. The coalition works to educate shareholders and lawmakers on the importance of adopting GSE reform that fully respects the legal rights of Fannie Mae and Freddie Mac shareholders and offers full restitution on investments.</div><div>
</div><div>###</div><div>
</div><div> </div><div>
</div><div>Fight over Fannie and Freddie’s profits intensifies</div><div>
</div><div>Posted April 10, 2014 by Investors Unite</div><div>Financial Times</div><div>
</div><div>April 9, 2014</div><div>By Gina Chon</div><div>
</div><div>The debate over the future of Fannie Mae and Freddie Mac is creating strange bedfellows, with consumer advocate Ralph Nader teaming up with a wealth manager to oppose the US government’s move to take all of the profits of the mortgage finance companies.</div><div>
</div><div>Mr Nader, CapWealth Advisor chief executive Tim Pagliara and other shareholders of Fannie and Freddie on Wednesday called on Congress to protect their rights to the profits as lawmakers consider bills aimed at winding down the companies. Some of the investors were in Washington DC to meet lawmakers to press their case.</div><div>
</div><div>Fannie and Freddie have been overseen by the US government after they received a $188bn rescue during the 2008 financial crisis. In recent years, they have been generating billions of dollars in revenue for the US Treasury after the bailout terms were revised in 2012 so that all of their profits go to the government.</div><div>
</div><div>View full article: http://www.ft.com/intl/cms/s/0/7222884c-bffb-11e3-9513-00144feabdc0.html?siteedition=intl#axzz2yRoAxQko</div><div>
</div><div> </div><div>
</div><div>Fannie, Freddie shareholder events ‘soften ground’ for claims in next Congress, analyst says</div><div>
</div><div>Posted April 10, 2014 by Investors Unite</div><div>Wall Street Journal</div><div>
</div><div>April 8, 2014</div><div>
</div><div>A flurry of activity among shareholders in Fannie Mae and Freddie Mac and interested groups may help them advance their cause next year, whenCongress is expected to continue its work on reforming the U.S. housing-finance system, an analyst says.</div><div>
</div><div>On Wednesday “Investors Unite,” a new coalition of shareholders in the federally controlled mortgage-finance companies, will send dozens of investors to Capitol Hill, and will also hold a meeting at the National Press Club.</div><div>
</div><div>View full article: http://blogs.marketwatch.com/capitolreport/2014/04/08/fannie-freddie-shareholder-events-soften-ground-for-claims-in-next-congress-analyst-says/</div><div>
</div><div> </div><div>
</div><div>Ex-Countrywide Exec Co-Wrote Mortgage Reform Bill</div><div>
</div><div>Posted April 10, 2014 by Investors Unite</div><div>The Washington Free Beacon</div><div>
</div><div>April 10, 2014</div><div>By Alana Goodman</div><div>
</div><div>Controversial housing finance reform legislation making its way through the Senate Banking Committee was co-written by a former mortgage trader for Countrywide Financial and Wachovia, two of the subprime mortgage behemoths at the center of the housing market crash in 2007.</div><div>
</div><div>Michael Bright, the senior financial adviser to Sen. Bob Corker (R., Tenn.), worked as a trader and member of the loan-pricing desk at Countrywide Financial from 2002 to 2006, and as a senior trader for Wachovia from 2006 to 2008.</div><div>
</div><div>Bright joined Corker’s office in 2010, and has been a key figure in crafting the Corker-Warner housing reform bill and the successive legislation spearheaded by Sens. Mike Crapo (R., Idaho) and Tim Johnson (D., S.D.).</div><div>
</div><div>“[Bright’s] running the show,” said Tim Pagliara, a top bundler for Corker who has taken an active stance against the bill. “And Corker listens to him.”</div><div>
</div><div>View full article: http://freebeacon.com/politics/banker-who-helped-crash-housing-market-helped-crafting-mortgage-reform/</div><div>
</div><div>Ralph Nader: Fannie and Freddie Shareholders Launch Investors Unite: Take to Congress to Make Their Voices Herald</div><div>
</div><div>Posted April 10, 2014 by Investors Unite</div><div>View Here: http://investorsunite.org/?attachment_id=270 </div><div>
</div><div>Nader Letter to Senator Johnson</div><div>
</div><div>Posted April 9, 2014 by Investors Unite</div><div>PDF: Nader to Senator Johnson</div><div>
</div><div>April 9, 2014</div><div>
</div><div>Senator Tim Johnson</div><div>136 Hart Senate Office Building</div><div>Washington, DC 20510</div><div>
</div><div>Dear Senator Johnson,</div><div>
</div><div>A few weeks ago, Senator Crapo and you unveiled their proposal for housing finance reform. This is a critically important issue that has remained unresolved for far too long. For that reason, I thank you and Senator Crapo for at least sparking a discussion. But we have serious concerns about your proposal. Unfortunately, this is an issue that is complex, and thus, difficult for many people to understand. I am writing you today to express some criticisms about your legislation.</div><div>
</div><div>Taxpayers, consumers and shareholders should have serious reservations about this proposal for housing finance reform. It does not adequately solve some of the issues with the government sponsored enterprises (GSEs) that contributed to the financial crisis and their conservatorship – and indeed potentially creates new problems. It does not sufficiently protect taxpayer dollars from being devoted to another bailout. It does not advance adequate support for affordable and low-income housing for underserved communities. It sets an objectionable precedent for shareholder rights and treatment in this country. And it leaves far too many regulatory decisions up in the air.</div><div>
</div><div>When the broad strokes of this legislative framework were announced in mid-March, I warned that by completely eliminating the GSEs as a part of housing finance reform, Congress could be further opening the flood gates to Wall Street abuses and excesses. Now that the legislative language has been released, we see that this serious risk is contained therein.</div><div>
</div><div>The proposals in the Senate and the House do not adequately anticipate the greed and power embedded on Wall Street in its incentive structure. And without laying out a strict regulatory structure, they seem to wrongfully assume that private capital will regulate itself. Do we really want to give even more power to the ‘Too Big to Fail’ banks that were principally responsible for this crisis to begin with?</div><div>
</div><div>The GSEs were certainly not blameless for transgressions similar to those larger ones committed by the Wall Street crowd prior to the financial crisis in 2008. But to eliminate them and unravel this intricate market further, could open the door wide for runaway corporate exploitation. We don’t argue that the GSEs should be maintained as is; but instead that they should be strongly regulated to prevent their previous missteps and abuses, and that shareholders should be allowed to participate in any future recovery.</div><div>
</div><div>In fact, many – if not almost all – of the reforms contained in the Johnson-Crapo housing finance reform legislative draft could be enacted within the framework of the current system and applied to the GSEs’ structure. It seems to unnecessarily complicate the reform by eliminating the GSEs completely and hoping a new entity in their place would purport to serve a similar purpose – all in order to advance a form of housing finance reform that could instead be applied simply to the otherwise functioning and experienced GSEs.</div><div>
</div><div>It is our understanding that the Senate Banking Committee will be meeting in April to discuss your legislative draft. Based on our understanding of the legislative language, our concerns are laid out below. Although the list is long, please do not misunderstand it as a comprehensive list of problems that we have with the legislation – but rather that it includes some of the most glaring issues. During the Committee’s discussion in April, it is hoped that you will address the concerns that follow.</div><div>Johnson-Crapo does not solve many of the problems that contributed to financial crisis:</div><div>
</div><div>– The legislation maintains a government guarantee. Albeit instituting a requirement that private capital take the first ten percent of losses. But this still leaves taxpayers on the hook for the other 90 percent. This does not go far enough, and maintains the problems with out-of-control moral hazard that existed prior to the 2008 financial crisis.</div><div>
</div><div>– Securities insured or guaranteed by the proposed Federal Mortgage Insurance Corporation (FMIC) are exempt from the laws administered by the Securities and Exchange Commission. Why should these securities be treated differently? Will this not distort the market and invite exploitation?</div><div>
</div><div>– FMIC is not adequately regulated. While the GSEs were regulated poorly, they did at least have regulators overseeing them prior to the financial crisis. This legislation would place the Federal Housing Finance Agency (FHFA) inside of the FMIC and leave it, and the products it approves, virtually unregulated. With such a large and powerful entity – even if it is a part of the federal government – one must be concerned about regulatory capture. Or, as its market share grows, about the FMIC turning into another iteration of the GSEs prior to the financial crisis.</div><div>
</div><div>– The board, officers, and employees of the FMIC are exempt from any liability under the Securities Act of 1933. Why? There should be consequences for flouting the law; government officials should not be exempt.</div><div>
</div><div>– The consumer voice is virtually absent from any executive or high-level positions within the FMIC – just one slot on a 9-member advisory committee to the board is vaguely dedicated to someone who can represent the consumers’ voices.</div><div>
</div><div>– The legislative draft exempts the FMIC and its counterparties from far too many potentially crucial regulatory frameworks currently in existence. Strong regulation of this complex market is crucial to avoiding future financial crises:</div><div>– There is an exemption for counterparties involved in approved credit risk-sharing mechanisms from being considered a commodity pool as defined in the Commodity Exchange Act.</div><div>– There is an exemption for approved credit risk-sharing mechanisms from section 27B of the Securities Act of 1933, a section which deals with concerns about conflicts of interest. Why?</div><div>Johnson-Crapo does not protect taxpayer dollars:</div><div>
</div><div>– The legislation sets up a Mortgage Insurance Fund (MIF), through fees, to protect taxpayers in the case of a future financial crisis. While it is good news that the legislation walls off these funds from the federal government, it doesn’t do the same for the FMIC. Instead of protecting and preserving these funds, the legislation authorizes the use of MIF funds for items other than a catastrophic scenario. It allows MIF funds to be used to pay FMIC employees, for establishing the common securitization platform (CSP), for funding the CSP, and for “all other expenses of the FMIC.”</div><div>
</div><div>– Standards are instructed to be set for first loss credit-risk sharing mechanisms that are designed to absorb the first 10 percent of losses. But the legislation then allows the FMIC to exempt these standards in the event of a financial crisis. Does this not create perverse incentives in which aggregators, guarantors, and securitizers know that they do not necessarily need to meet the requirements to be approved and insured with a government backstop? Does this not create the same type of moral hazard that existed with the GSEs and their implicit government guarantee?</div><div>
</div><div>– The legislation allows approved guarantors to fulfill their capital standards through the use of credit risk-sharing mechanisms approved by the FMIC. But it does nothing to delineate that the counterparties in these risk-sharing mechanisms need be approved or meet certain standards. Would this not risk the integrity, safety, and soundness of these risk-sharing mechanisms? This could potentially inject an unknown amount of risk and would seem to not be a safe and secure means of protecting the FMIC or the MIF against losses. We would imagine that this opens up an exploitable loophole.</div><div>Johnson-Crapo is not good for affordable housing:</div><div>
</div><div>– The affordable housing goals of the GSEs are eradicated when the legislation eliminates the GSEs. This is not replaced by any new goals or incentives for the FMIC that compensate for this significant blow to affordable housing.</div><div>
</div><div>– Though the legislation broadly instructs FMIC to support underserved areas, it provides no adequate framework or goals whatsoever to ensure that this happens.</div><div>
</div><div>– In fact, the legislation specifically prohibits the FMIC from putting in place regulations that would require approved aggregators or guarantors to include loans to underserved areas as a portion of their business. It explicitly states that the FMIC’s standards for approving aggregators or guarantors cannot interfere with the guarantor’s or aggregator’s exercise of “business judgment” in mortgage loans. This is one of the ripest areas for incentivizing affordable housing – and the legislation summarily prohibits it! Why?</div><div>
</div><div>– In this sense, the legislation does little more than pay lip service to the importance of affordable housing, low-income housing, and serving underserved areas. Senator Elizabeth Warren was right, when speaking at a recent National Community Reinvestment Coalition conference, to warn that we should pump the brakes and not rush into a housing reform proposal that we will end up regretting. Senator Warren made the point that, “if we get housing finance wrong, the impact will be felt throughout America’s middle class.” And lower income Americans as well.</div><div>Johnson-Crapo leaves too many regulatory decisions up in the air, without a baseline:</div><div>
</div><div>– The legislation consistently lays out the type of regulations FMIC should adopt. But it does not proscribe a baseline regulatory structure. Allowing the FMIC flexibility in setting its own regulations and some adaptability to be able to adjust to changing market conditions can be considered within limits. But there are certainly some basic regulations that we can agree on and simple baselines that should be outlined in this bill for many of the regulations it instructs the FMIC to codify on its own, besieged as it would be by corporate law firms.</div><div>
</div><div>– In the proposed legislation there are instructions for the FMIC to set things like “capital and solvency standards for covered entities” without the legislation setting a baseline for what would be a minimally acceptable level.</div><div>
</div><div>– Leaving the specifics of regulatory structure completely up to the FMIC seems like a recipe for these regulations being weakened under corporate pressure in the administrative and rulemaking process.</div><div>Johnson-Crapo sets an objectionable precedent for shareholder rights:</div><div>
</div><div>– Fannie Mae and Freddie Mac are unjustly and unnecessarily wiped out. Many, if not almost all, of these reforms could be enacted within the current housing finance system.</div><div>
</div><div>– Fannie Mae and Freddie Mac shareholders are left in limbo with this legislation, and it ignores them in the process of winding down the agencies. The FHFA is directed to sell off and liquidate the GSEs’ assets.</div><div>
</div><div>– The federal government has used and abused the GSEs’ shareholders since putting them into conservatorship and not allowed them any ability to share in the GSEs’ recovery. The taxpayers should certainly be paid back first. But once that happens, with interest for the taxpayers’ investment, there is no reason that the shareholders (of whom I am one) should not be allowed to benefit from the recovery of the GSEs much in the same way that shareholders of other bailed out large corporations did – like those of AIG and Citi. This legislation would seemingly prevent this from happening.</div><div>
</div><div>– When the FHFA established the conservatorship for Fannie Mae and Freddie Mac and assumed control of these two GSEs on September 7, 2008, shareholders lost their voting rights, dividends on preferred and common stock were suspended, and annual shareholder meetings were canceled. The federal government received warrants to buy up to 79.9 percent of GSE common stock for $0.00001 per share – just shy of the 80 percent threshold to be reflected in the government’s budget. These actions turned the non-government shareholders into, in essence, zombie stockholders with no rights and no remedies against the GSEs or the FHFA.</div><div>
</div><div>– Further, just as the GSEs began a swift turnaround and were on the verge of repaying the taxpayers for their investment, the Treasury in 2012, arbitrarily amended the government’s preferred stock purchase agreement to indefinitely sweep all profits of the GSEs into the Treasury’s coffers. This arrangement has allowed the federal government, and the budget, to benefit from the GSEs’ recoveries while at the same time keeping the GSEs’ liabilities off of the federal government’s books. Meanwhile, the shareholders continue to be used and remain beaten down.</div><div>
</div><div>– By unilaterally winding down the GSEs, the legislation continues the federal government’s unfortunate precedent of using and abusing the GSEs’ shareholders.</div><div>Please consider these comments in your consideration of any new legislative framework for housing finance reform. I hope you will engage with all stakeholders in your deliberation on this important issue. I look forward to your thoughts and comments.</div><div>
</div><div>Sincerely,</div><div>Ralph Nader</div><div>
</div><div>P.O. Box 19312</div><div>Washington, D.C. 20036</div><div>202-387-8030</div><div>
</div><div> </div><div>
</div><div>Fannie Mae, Freddie Mac shareholders rail against measure to dismantle two firms</div><div>
</div><div>Posted April 9, 2014 by Investors Unite</div><div>Washington Post</div><div>
</div><div>April 9, 2014</div><div>By Dina ElBoghdady</div><div>
</div><div>Dozens of Fannie Mae and Freddie Mac shareholders flocked to Capitol Hill on Wednesday to rail against a Senate proposal that they say would trample on the rights of the mortgage giants’ investors, the latest in a frenzied push to influence the housing finance debate.</div><div>
</div><div>In the past two weeks, three groups have weighed in forcefully on the Senate legislation, which seeks to dismantle D.C.-based Fannie and McLean-based Freddie, replace them with a new entity and shift more of the risks of mortgage lending to the private sector.</div><div>
</div><div>These groups are demanding a stop to what they view as the government’s rip-off of Fannie and Freddie investors. In August 2012, about four years after the government took control of the two mortgage firms, federal officials directed the companies to turn over nearly all profits to the U.S. Treasury. Several investor groups have sued to challenge the arrangement.</div><div>
</div><div>View full article: http://www.washingtonpost.com/business/economy/fannie-mae-freddie-mac-shareholders-rail-against-measure-to-dismantle-two-firms/2014/04/09/70be13e0-c00a-11e3-bcec-b71ee10e9bc3_story.html</div><div>
</div><div>Fannie, Freddie shareholders lobby against U.S. housing reform bill</div><div>
</div><div>Posted April 9, 2014 by Investors Unite</div><div>Reuters</div><div>
</div><div>April 9, 2014</div><div>By Margaret Chadbourn</div><div>
</div><div>(Reuters) – A coalition of investors in Fannie Mae and Freddie Mac on Wednesday launched an effort to stop Congress from moving ahead with a U.S. housing finance reform bill, arguing it would deny them a fair share in any remaining value in the two companies.</div><div>
</div><div>The new tax-exempt group, Investors Unite, said it wants to protect the rights of shareholders in the bailed-out mortgage finance companies. It is holding meetings in Washington and sending dozens of investors to Capitol Hill to promote its cause.</div><div>
</div><div>View full article: http://www.reuters.com/article/2014/04/09/us-fanniemae-investment-idUSBREA3228V20140409?feedType=RSS&feedName=topNews</div><div>
</div><div>Investors Unite to Johnson-Crapo: You shall not pass!</div><div>
</div><div>Posted April 9, 2014 by Investors Unite</div><div>Housing Wire</div><div>
</div><div>April 9, 2014</div><div>By Trey Garrison</div><div>
</div><div>Consumer advocate Ralph Nader, CapWealth AdvisorCEO Tim Pagliara and dozens of GSE shareholders from 20 states want GSE reform that guarantees shareholder rights, and reject Johnson-Crapo as unacceptable.</div><div>
</div><div>The shareholders want recapitalization and their shares before reform, and only after that should various reform measures be considered. That’s the position of Pagliara’s newly formed Investors Unite.</div><div>
</div><div>View full article: http://www.housingwire.com/articles/29613-investors-unite-to-johnson-crapo-you-shall-not-pass</div><div>
</div><div> </div><div>
</div><div>Group protests changes to Fannie Mae, Freddie Mac</div><div>
</div><div>Posted April 9, 2014 by Investors Unite</div><div>The Tennessean</div><div>
</div><div>April 9, 2014</div><div>By Jamie McGee</div><div>
</div><div>Franklin investment advisor Tim Pagliara led Fannie Mae and Freddie Mac investors in a protest today in Washington, D.C., against federal legislation they say will wipe out their holdings in the mortgage giants.</div><div>
</div><div>Organized by Investors Unite, a coalition founded by Pagliara, the purpose of the effort was to give faces to investors who would be affected, illustrating that they don’t just represent hedge funds, but also include individual investors.</div><div>
</div><div>At issue is a bipartisan bill proposed by Sens. Tim Johnson and Mike Crapo that would wind down the mortgage giants, replacing them with a government mortgage insurance system backed in part by private capital. Returns from Fannie Mae and Freddie Mac, placed under government conservatorship in 2008, have been going to the U.S. Treasury since 2012, and the proposed bill leaves in question how shareholders would fare if the companies are dismantled.</div><div>
</div><div>View full article: http://www.tennessean.com/story/money/real-estate/2014/04/09/group-protest-changes-fannie-mae-freddie-mac/7520475/</div><div>
</div><div>Why Fannie Mae (FNMA), Freddie Mac (FMCC) Stock Are Higher This Afternoon</div><div>
</div><div>Posted April 9, 2014 by Investors Unite</div><div>The Street </div><div>
</div><div>April 9, 2014</div><div>By Tedd Cohen</div><div>
</div><div>NEW YORK (TheStreet) — Shares of Fannie Mae (FNMA) and Freddie Mac (FMCC) are higher today after a coalition of investors in both companies began a move to stop Congress from going forward with a U.S. housing finance reform bill, saying it would deny them of a fair share in any remaining value in the companies.</div><div>
</div><div>Fannie Mae’s share are up 0.99% to 4.10, while Freddie Mac’s shares are up 1.23% to 4.12.</div><div>
</div><div>The new tax-exempt group, Investors Unite, said it wants to protect the rights of shareholders in the bailed-out mortgage finance companies. It is holding meetings in Washington and sending dozens of investors to Capitol Hill to promote its cause, Reuters reports.</div><div>
</div><div> The group opposes the bill because it would prevent the companies from recapitalizing and compensating shareholders.</div><div>View full article: http://www.thestreet.com/story/12641589/1/why-fannie-mae-fnma-freddie-mac-fmcc-stock-are-higher-this-afternoon.html</div><div>Fannie Mae, Freddie Mac: Ralph Nader Issues Long Letter</div><div>
</div><div>Posted April 9, 2014 by Investors Unite</div><div>Value Walk</div><div>
</div><div>April 9, 2014</div><div>By Jacob Wolinsky</div><div>
</div><div>Mr. Nader asked that I send the attached comments on Senator Johnson’s and Senator Crapo’s legislative framework for housing finance reform. This letter was sent this morning to all of the Senators on the U.S. Senate Committee on Banking, Housing, and Urban Affairs.</div><div>
</div><div>Mr. Nader was also scheduled to take part in a press conference this morning with a coalition called “Investors Unite.” Unfortunately, he came down ill this morning and was unable to make it. He was deeply sorry to miss it – as it involved a wide range of individual investors in Fannie Mae / Federal National Mortgage Assctn Fnni Me (OTCBB:FNMA) and Freddie Mac / Federal Home Loan Mortgage Corp (OTCBB:FMCC) from across the country who came to D.C. to make their voice heard on the Hill. The statement he would have given at this event is also attached to this email.</div><div>
</div><div>The Past, Present and Future of Fannie and Freddie: Government Intransigence on the Current Lawsuits Could Make It Impossible to Reprivatize the Residential Mortgage Market</div><div>
</div><div>Posted April 9, 2014 by Investors Unite</div><div>Point of Law</div><div>
</div><div>April 9, 2014</div><div>By Richard A. Epstein</div><div>
</div><div>Today, the momentum is growing for fundamentally restructuring the national residential mortgage market in the wake of the earlier collapse of the Federal National Mortgage Association (FNMA, or “Fannie Mae”) and Federal Home Loan Mortgage Corporation (FHLMC, or “Freddie Mac). These two government-sponsored enterprises (GSEs)–so-called in recognition of their hybrid public/private nature–have long written large chunks of the residential home mortgage market, to the tune of trillions of dollars. The current legislative fixes now on the table include a bipartisan proposal from Tim Johnson and Mike Crapo, coupled with an earlier entry by Maxine Waters. The Johnson-Crapo proposal follows on earlier entries from Jeb Hensarling on the House side and Bob Corker on the Senate side. Each of these proposals seeks simultaneously to unwind the past and to redefine the future. To evaluate them requires understanding the historical linkage between past events and future prospects.</div><div>
</div><div>To begin, some background. In response to the brewing subprime mortgage crisis in 2008, Congress in late July of that year passed the Housing and Economic Recovery Act (HERA). That legislation, inter alia, created a new Federal Housing Finance Agency (FHFA), which on September 7, 2008 placed into a conservatorship both GSEs. These conservatorships were intended to keep both entities alive in order to facilitate their return to the private market. They were not receiverships whose object is the orderly liquidation of the two businesses. The basic plan called for an infusion of up to $200 billion in fresh cash into Fannie Mae and Freddie Mac under a Senior Preferred Stock Purchase Agreement (SPSPA) that gave the government warrants, exercisable at a nominal price, to acquire a 79.9 percent ownership stake in each enterprise. In exchange for that advance the senior preferred stock carried a 10 percent annual dividend payment, which went up to 12 percent if the GSEs delayed their dividend payments on the senior preferred.</div><div>
</div><div>View full article: http://pointoflaw.com/columns/2014/04/the-past-present-and-future-of-fannie-and-freddie-government-intransigence-on-the-current-lawsuits-c.php</div><div>
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