Thursday, August 28, 2014

Labor Day Blog: Say it ain’t so, Tim Mayopoulis



Fannie to Sell “3900 Wisconsin Ave”


Fannie Mae officials told staff on Wednesday that they plan to sell their distinctive and prized 3900 Wisconsin, Avenue, NW headquarters, in the next few years, and move all staff to downtown DC, consolidating employees from a handful of area locations in a single leased facility.

If they follow through, it troubles me that Fannie is going to give up the much heralded building. But I am more surprised that they have the balls to plan three years into the future, given that so many people want to behead, eviscerate, abolish or otherwise shut them down.
I can’t wait to hear the rationale and the inevitable complaints from the Hill regardless of the price they receive for this very, very prime piece of Washington real estate and no matter where they move. 

Don’t be surprised if many of the august area private schools (Sidwell, Cathedral, St. Alban’s, Maret) look covetously on the acreage, if no more than to demolish it and build anew.

Then there is the question of what Freddie does, if as I suspect this move was dictated by FHFA (which must have had something to do with it), since Freddie’s McLean, Virginia HQ is not that picturesque, albeit newer.


When I first started at Fannie in 1983, there were daily rumors about “Arab investors” wanting to acquire the location, with its red brick Williamsburg look, which--before Fannie bought it--formerly had been home to an insurance company.

That company was called “the little Equitable” to distinguish it from the NYC giant with a similar name.  

Fannie’s attractive and well-manicured site once was scouted by Hollywood for possible location filming as part of the movie “St Elmo’s Fire.” That didn’t happen, although some scenes for the movie were shot in DC’s nearby Georgetown section.

One Fannie Mae vet reminded me, if Fannie moves downtown, it will come full circle, since their original pre-3900 offices were there at the Madison Hotel on 15th Street, NW. 

Then company officials responsible for the move to upper Wisconsin Avenue, managed to reopen a shutdown Virginia brickyard to supply matching bricks for a 3900 building expansion.

In a future blog—while noting lots can happen in three years—I’ll write about many of the unforgettable and some truly laughable moments which occurred in and around 3900 during my time in the building. 

One final and serious thought.

I haven’t been an insider at Fannie for 10 years, but there is not a person now with whom I speak--at both companies or who follows them--who fails to note how ridiculously overstaffed are both F&F.

Maybe Fannie management, before moving from its to-die-for corporate headquarters--four long blocks from the National Cathedral, with choice parking behind the building, and a pastoral setting beyond that--should do a serious and critical work force audit and see if they can reduce that number by half or more (which is the figure people always suggest) and then just house everyone in 3900. 

How many of those spots filled since the 2008 emergency have ossified and are unnecessary, like those who hold the jobs and could thoughtfully be jettisoned? 

A surgical operation like that make more sense than stuffing an inflated staff—with little work to keep them busy--into another non-descript downtown DC building.

There’s architectural character and historic value in 3900 that you won’t find elsewhere and there is virtue in lean and mean (although I realize you are not allowed under FHFA rules to be “mean” or even entrepreneurial)! 


MI Industry Seeks More Help from FHFA


What, more pleadings to generate additional revenue?

With the QM rules fully applicable to most every loan F&F securitizes, responsibilities should be easier for the private mortgage insurance industry (PMIs). 

MI companies provide policies on loans where the mortgagor doesn’t have the required 20% down payment. When a default occurs, the insurance company covers losses of the investor or guarantor. 

With most but not all of their of their business going to Fannie and Freddie, the MIs are being asked to insure a much higher quality of loan, reducing their own risk as well. 

That didn’t stop Moody’s Mark Zandi and the Urban Institute’s Jim Parrott (I remember those guys!) from advocating looser rules for the MI’s, in a report commenting on the Federal Housing Finance Agency’s (FHFA) proposed tougher requirements for the MI industry.

Both men were major advocates for the Senate’s CWJC bill, which would have opened huge market opportunities for the MIs, so their advocacy is consistent.....kind of.

Work the Hill and work the agencies. It’s an old game for some folks. 

(Note to MI industry leaders, you might want two of your ilk--PMI, the company, and Triad--to pay F&F what they owe from the last debacle, since their recent SEC filed 10Qs show only partial payments.)


Tooting Your Own Horn

When I came to Washington 45 years ago to work on Capitol Hill for Pittsburgh Democrat, Bill Moorhead--a member of the House Banking Committee--I remember him educating/counseling me, “He who tooteth not his own horn may not have the same tooted.”

The Congressman’s Washington self-promotion advice came back to me while rereading some recent blogs, when I called on the Administration to aggressively get after IS, engage other allies, and even work with Russia (which Obama never should trust) and Assad’s government to bomb ISIS in Syria, where they may have some vulnerable troop/equipment concentrations.

It appears the President is doing just what I suggested, his public comments notwithstanding.

Obama is the lamest of ducks, cannot run again and I doubt if he can help most Democrat office seekers, incumbents or newbies, but I also felt that his personal popularity would go up with the slightest projection of military power, which is more a comment on this nation than it  our President.

Going forward, I hope that BHO speaks less and does more.

ISIS hardly is naïve and the more the President and his aides talk about striking them in Syria, the more they disperse their assets.

More than six years into his job, the President still hasn’t learned to act first and then talk about it afterwards.

Now, if I just could get Mr. Obama to straighten out his head on GSEs matters.


Goldman Sachs, Pays the Feds, F&F


Industry icon Goldman Sachs became the latest to do a FHFA MBS perp walk and will pay $1.2 Billon for misleading F&F on mortgage securities sales.

Look for some/most/all of that money to wind up in F&F earnings (and therefore Treasury coffers) in the third if not fourth quarter of 2014.



And thanks to David Fiderer for alerting me to this FHFA document which catalogues all of the revenue generated from federal actions against lenders who, one way or another, screwed over Fannie and Freddie.

Note, this doc also refers to two cases still outstanding.

Congressmen Profit from “Inversion”

Are you shocked? Two GOP House leaders, including John Boehner, the Majority Leader, are profiting from US firms taking their business operations out of the US to avoid the US tax system. The process is called “tax inversion,” because the move produces a reduction in corporate taxes paid. 

The most recent example is Burger King buying “Tim Horton’s” corporate donuts operation and moving to Canada where the corporate tax bite is smaller.

I’m sure they are others in Congress from each both parties, doing what the prominent House R’s did, making money on firms which do that or facilitate those moves. But these guys have reported their financial positions thus the publicity. 

I wonder how the Tea Party’s “America firsters” view these financial machinations. 

Speaking of Burger King……

Everyone knows that Pershing Square’s Bill Ackman, who owns more Fannie and Freddie common stock than any other investor, has joined others in suing the Treasury over the 2012 “third amendment” which swept all Fannie and Freddie earnings into the nation’s general fund. 

Ackman’s certainly “knows his onions”—as we used to say on my street when acknowledging success and genius—but I guess he also know his hamburgers.

On one day last week, Ackman made over $200 Million on his Burger King investment, which now is in the $1.25 Billion range, following BK’s acquisition of the Canadian Tim Horton Company. (See Inversion story.)

Congress should pay closer advice to tAckman who has been pushing hard for Fannie and Freddie to be turned loose from their federal shackles and be allowed to once again lead the nation’s mortgage finance system.

What Others are Saying?

Laurie Goodman and her colleagues at the Urban Institute have put together a most readable document on mortgage finance reform, what has and hasn’t happened and possibly the why of it. It’s linked below.



Brandon Ivey, writing in Inside Mortgage Finance, notes predictable GOP opposition to the SEC’s proposal to tighten up rules for the rating agencies, which so glaringly abetted the big bank’s PLS activities in 2006 and 2007 by issuing inflated ratings for $2 Trillion of junk mortgage bonds which soon failed.


Added post-facto. The NYT today ran a panel discussion about bank responsibility and making banks more ersponsible. I am adding it to the blog because I read it post publication.


Maloni, 8-28-2014

Friday, August 22, 2014

It's Still Summer


Third Week Cats and Dogs 


I am going out of town this weekend to see family and meet old friends in Pittsburgh for an unofficial reunion, so I wanted to get this week’s blog out before traveling. 

Summer is the dead time in DC with the Congress gone and most of those who cover or relate also on their summer vacations, but stuff still goes on. 

Earlier this week, John Bancroft from Inside Mortgage Finance reported following his gleanings of bank call reports that bank income from mortgage activity rose significantly in the second quarter of 2014 to almost $4.91 Billion, up 45% over the first three months of the year. 

Those figures are down from 2012 and 2013 numbers, but still are healthy give the many ways banks can generate revenue. 

I want to juxtapose those earnings with three items. The first is that overall bank earnings through the second quarter were up to almost all-time highs, meaning those levels were achieved with smaller mortgage profits. 

The broader positive numbers haven’t stopped the bank Washington lobbyists from demanding additional support from the federal government to enhance their members’ bottom lines. (See last week’s discussion about the Financial Services Roundtable call on Treasury to help its members restore faith in private labels securities, PLS). 

I hope someone in this Treasury Department responded to the FSR by channeling their best John F. Kennedy, saying, “Governor Pawlenty, Mr. Dalton, ask not what your country can……” 

Most important to me, the increase in quarterly bank profits which IMF reported comes with Fannie and Freddie underpinning the national market supporting whatever mortgage activity the banks conduct, meaning working cooperatively with those banks that made so much cash. 

Inside the Beltway rhetoric is one thing, but I believe there are many large banks, including at least one of the TBTF banks, which see F&F as a desirable market component and key to their mortgage. lending business activity. 

It’s only logical, since securitizing through F&F takes the risk from the bank balance sheets and transfers it to the guarantors and obviously, the financial institutions still make money. And it is an easy and smooth operation, with which all banks and mortgage companies are familiar. 

Yet, everyone assumes that the banks hate and want to destroy Fannie and Freddie. Maybe their trade groups do because some in Congress look to them for that very response. Someone should ask the banks top execs and then parse their answers carefully. 

Here’s Bancroft’s IMF story. 



Ferguson, Missouri and the GSEs???

In my wildest dreams, I never would conflate the chilling events in Ferguson with Fannie and Freddie, but that didn’t stop Rafferty Capital Market’s analyst Richard Bove from doing so earlier this week in a novel approach putting down the CorkerWarnerJohnsonCrapo Senate bill, which the Obama Administration supported. 

Bove’s thesis is that Ferguson like many, many other hardcore urban communities could benefit from what F&F do best which is to finance homeownership and that some of the community angst, which exploded after the killing of an unarmed 18 year old man by a police officer, reflects a certain level of hopelessness and disinvestment that owning a home, having a greater stake in the community and the schools and representation could ameliorate. 

Bove is worth reading, if for no other reason, than while temporarily quiet, the community could erupt again, once grand jury testimony and police reports start emerging. 

I am not sure if anything Fannie or Freddie could do, going forward, can help Ferguson but they might help in other communities before they become the next Ferguson. 


Carney Sees No F&F Help from Ackman

I wouldn’t cast the WSJ’s John Carney as a “Fannie-fan,” far from it. 

Writing pessimistically in the Journal last week, Carney threw out several reason why he thought the new lawsuits by Pershing Square’s Bill Ackman, largest holder of Fannie and Freddie common stock, would not lead to anything, citing some of the bizarre Catch-22 provisions in the whole “conservatorship” gestalt and even why a plaintiff’s victory might not get them much. He also didn’t think the GSEs would be positive earners.

Here’s Carney’s story.

He could be spot on, but I doubt it.

In a message to Carney, I told him why his overreliance on the "conservatorship" deal parameters might be wrong, primarily because Obama Administration or a new one in 2017—if so motivated--simply could change the applicable conservatorship rules if it chose. 

And, depending on when Judge Sweeney renders a decision, a Democrat President could want to use a plaintiff’s decision to recapitalize the two, while a conservative Republican chief exec might just agree with the investors and want to see them benefit financially.


ISIL/ISIS/IS (Whatever) 

Yes, destructive US air assaults may anger the IS, but could they really be anymore pissed at us? They already threatened to see us “in New York.” It would seem if we offered the Syrian government and their Russian sponsors some heavy (and repeated) carpet bombing in eastern Syria--where the bad guys reportedly have 50,000 fighters—we could kill a lot of the troglodytes and make others think twice about joining. That could soften them up for the Syrian and other anti-Syrian forces battling them, not to mention the Iraqi Army and the Kurds waiting for them in northern Iraq. 

IS likely will kill the other American they hold and be grisly about it, and then what will the President do, really get angry with IS? 

Just a thought.


What Others Are Saying


Byron Tau reporting in Politico says that the Financial Services Roundtable (FSR) has a problem with the Consumer Finance Protection Board’s (CFPB) plan to permit consumers to post financial services complaints on a government provided website.

FSR PUSHES BACK AGAINST ANONYMOUS CONSUMER REPORTING: The Financial Services Roundtable is launching a new multimedia campaign on Monday blasting a proposal from the Consumer Financial Protection Bureau that would allow consumers to post complaints about financial services companies on a government-run website. The association representing the financial services industry raises concerns that those complaints will be "unverified, anonymous and potentially inaccurate." 'The CFPB's plan will feature only one side of the story, and such one-sided accounts will not advance the CFPB's mission of better informing and helping consumers," said FSR President & CEO Tim Pawlenty in a statement. The new FSR campaign includes advertising in Washington metro stations, as well as a social media ad buy.

Hubris, Squared? Or Just Idiocy


Dick Kovacevich, former Wells Fargo chairman & CEO, explains why he thinks the massive $17 billion Bank of America settlement with the Justice Department is extortion. Companies don't commit crimes, people do, contends Kovacevich.


Really Dick, nobody at Wells committed any crimes???

(Thanks DF for sending me this clip.)



Maloni, 8-22-2014

Monday, August 18, 2014

Slow Legal and Legislative Processes

Waning Summer GSE Issues


More Lawsuits

I love the wide speculation over, now, 20 lawsuits filed charging the federal government over a variety of transgressions against Fannie. Freddie and their investors. Pershing Square’s Bill Ackman, largest individual common stock holder in each company, filed two more last week. 

To this layman, the Ackman charges appear similar to the previous legal actions aimed at Treasury. I’ll need one of you trenchant observers or lawyers to tell me exactly what I am missing, since I am sure there is something. 

But, in the traditionally slow summer months, these developments keep Fannie/Freddie in the news, which is positive and forces policy makers to realize the GSEs and their advocates won’t quietly go away, almost no matter what Judge Sweeney decides. And, depending on its nature and scope, her decision could jolt some political/market creativity from minds that have approached the nation’s mortgage market naively and simplistically.

As I keep reminding, we are talking about a national economic segment—with Fannie and Freddie, like it or not, at the helm--which historically has accounted for 17% or so of our GNP.

Read Dan Freed’s Ackman article in “The Street,” linked below.

Discovery Crawls in “Takings” Case


The diligent CRT Capital’s Michael Kim produced a superb/comprehensive report this past week of highlights of Judge Margaret Sweeney’s hearing into progress or lack of same on plaintiffs discovery efforts in the “Third Amendment” and “takings” case.

As Michael notes, it’s a slogging effort and might be another four months before completed. 

The good news is his content, the bad news is I can’t link his work for you’ (I am a self-proclaimed “tech idiot.”) But Michael has agreed to provide a copy to anyone who contacts him. Here is Mike’s email address


Bank Earnings and GOP Yearnings

As the WSJ’s Robin Sidel reported in Yahoo, US banks are compiling record earnings, again, but still seem to bitch and moan that they need additional tools to make more cash; see the Financial Services Roundtable (FSR) segment later in the blog.

The earnings story dovetailed nicely with a second story appearing in Politico, saying the GOP has its sights on Wall Street hoping to milk the big financial institutions for even more campaign cash.

Does anyone doubt the strategy will be successful and produce beau coup GOP Street-friendly legislative and policy decisions?


"Poor" Bigguns Seek Treasury Help

Speaking of the big banks and financial services companies, the Financial Services Roundtable (FSR), the Washington trade group for many of them—responding to a Treasury request for comments--asked the agency to try and facilitate greater trust among players in the Private Label Securities (PLS) market which has not been as liquid or lucrative since the big guys, bypassed the F&F systems and issued over $2 Trillion dollars in poorly underwritten and soon to fail PLS securities.
OK, who feels sorry for those institutions? 

Those tainted bonds generated more than four times the losses Fannie and Freddie incurred (over $700 billion in PLS red ink, source Laurie Goodman, to F&F’s well known $187.5 Billion or $140, if you don’t the money the GSEs initially had to borrow to pay Uncle Sam, interest because they had no earnings to employ.) 

The FSR’s letter was signed by John Dalton—The FSR’s Housing Policy President--an old friend and colleague from my days at the Federal Home Loan Bank Board, where once John was a board member and later named Chairman in 1981, after I left for a Fed position. 

Here is a brief email I sent John with my take on his letter. 

Isn't the biggest issue the fact that the market for PLS securities doesn't trust the big institutions which stand behind them? Those institutional investors still are leery of the bad old days, as they should be. 

What's Treasury supposed to do short of killing F&F and giving your guys a new federal guarantee on your securities losses? 

That won't happen until the nation has a single political party controlling the WH and both congressional chambers, possibly in 2017. 

I thought I went high road with my FSR commentary, but not so a wizened senior banking industry observer, who sent me the following after reading the FSR Treasury letter.


The financial behemoths led by the FSR, with the ABA following behind, haven't changed their spots. 

They want it all--systemic risk and TBTF be damned including: the housing GSE's market share, Fed support for resuscitation of the PLS market when the FED should concentrate on the unwinding of its own bubble, its $4,365,666 million balance sheet; and of course destruction of Dodd Frank now focusing on the living will requirements which seek to impose bankruptcy market discipline on those who apparently benefit and enjoy their wards of the state status. 

Of course they are willing to handle more systemic risk--with a government guarantee. Can the Yellen Fed say "no?"

Ouch and all I asked him was, “What do you think of the FSR letter?”

Fannie & Freddie to Issue Common MBS

Federal Housing Finance Agency (FHFA) Director Mel Watt took steps last week to have Fannie and Freddie issue identical mortgage backed securities, after almost 35 years of each having a different structure.
Watt’s action was driven by the fact that investors valued the Fannie MBS higher, preferring the structure and payment schedule of the Fannie MBS, causing Freddie’s to lag in market acceptance. 

In previous blogs, I advocated just having teams from each entity meet and quickly model the Freddie bond on the Fannie model, which probably was too simple a direction and doesn’t occur when federal departments tackle problems.

It looks like that now will happen, but over a period of 18 months or so.

The problem won’t be adapting a new Freddie security but how the market will price Freddie legacy portfolio.  

Even though I am a huge Fannie fan, I consider Watt’s actions mostly benign to constructive, although it will make merging the two far easier down the road. Freddie had the option, years ago, to remodel their MBS but for institutional ego purposes chose to maintain their “brand.” 

I never felt that Watt’s predecessor, Ed DeMarco, pushing the common securitization platform (CSP) and related goals was being helpful, just his own agenda of facilitating his own agenda of abolishing the GSEs.


What Others are Saying


Read why Gretchen Morgenson, in her Sunday NYT column, believes that bulldozers are a necessary component of any government settlement with the Bank of America and she’s correct.



Al Jazeera’s Marwan Bishara instructs readers on how to interpret terminology in UN Middle East resolutions.


Most mortgage players are opposed to any increase in F&F guarantee fees, but not the Security Industry and Financial Markets Association (SIFMA), which urges FHFA to mandate those increases to make PLS more attractive alternatives to F&F bonds. (But won’t that make mortgages in those securities more costly?)

Charles Wisniowksi had this story last week in Inside Mortgage Finance.



For your house hunters, the NAR says mortgage rates are at their yearly low.$5B871apbR&om_ntype=RMODaily


Maloni, 8-18-2014


Monday, August 11, 2014

Book the ++ GSE Performance, Don't Fight It



F&F Second Quarter Cash Gives Prez
A Golden Chance to Lock in Success



What wonderful, superb Fannie and Freddie earnings! (Of course, in its classic “the glass is half empty” mode, the Washington Post’s headline writers wrote that F&F reported a drop in profits.)

The numbers were truly scintillating and timely for several reasons.

I hope mortgage market observers and Hill policy makers took serious note of last week’s GSE earnings, allowing them to send $5.6 Billion more to the Treasury/the taxpayers ($Fannie’s $3.9 Billion and Freddie’s $1.7 Billion).


Who’s on First? 

The payments to Treasury are under that screwy arrangement where F&F never ever can pay back the capital invested in them in 2008. Ask your Congressman to give you a common sense explanation of that transaction which a layman can grasp. 

Now work with me on this: because F&F didn’t start making money until 2012-2013, their 2009-2010 first payments, in part, were for cash borrowed from the Treasury to pay the Treasury interest on @$140 Billion of principal actually infused. That “interest” pumped the actual GSE debt amount to $188.7 Billion. 

But, why quibble over details, since OMB, CBO, and Treasury can’t agree on what F&F are or did in a federal budget sense? 

(Did I mention that F&F were stuck with a 10% interest rate, while the banks paid just 5%; ask your Congressman about that, too.) 

As most know, the Tim Geithner 2012 “Third Amendment” dividend change--that swept all Fannie and Freddie earnings to the Treasury--now is being challenged in court by different 17 plaintiffs. 

When F&F send Treasury their next quarterly disbursements in September, the two (in two years) will have paid back to taxpayers $208 Billion or roughly $20 Billion more than they were given or $60 Billion more if you somehow deduct the money borrowed to pay for the money borrowed. (No, this is not an Abbot and Costello comedy routine!)

Judge Sweeney Yet to be Heard 

Obviously the courts will deciding the “sweep and takings” matter on its own schedule, a decision which likely—but not automatically--will be challenged in the Supreme Court, but with no sense of when (or no guarantee this conservative business friendly court will want to hear the case, especially if the plaintiffs prevail). 

Just on the face on them—before looking beneath-- the earnings say that F&F have done a good job  holding up the nation’s mortgage finance system and delivering to Treasury (in lieu of shareholders, for now) healthy multi-billion earnings that would delight stock analysis and stockholders. 

F&F have both. But they all live in an “Alice in Wonderland” world where earnings mean little and the pronouncements of congressional ideologues or right wing think tanks count for more than financial results.

Let me make two observations, consistent with my ongoing suggestion that caught up in their ass backward myth that F&F caused the 2008 financial meltdown and need punishing, the White House and Congress are failing to take credit for a good story but also whiffing on a chance to cement in place much of the system which exists today, with little of the drastic and complex legislative architecture that many on the Hill propose as a solution to “What do we do with Fannie and Freddie?”

How about this, just do very little or nothing?


Solid Earnings Squared! 

Read both between the lines of the earnings statement as well as the exact words of their execs. (Both companies likely know right now that they will be profitable throughout this year and into the next and likely could give you a good estimate of what those 2015 numbers might be. But, why spoil the fun?) 

What we saw last week is going to be standard fare for the next several quarters.  Notice that neither company had any major credit losses undercutting their reports, which suggests that the positive numbers should continue for a long time as the quality of their quarterly business books gets better and better. 

Unless Congress enjoys beating its head against that concrete wall represented by housing interests, Realtors, Homebuilders, small and regional non-TBTF banks, and myriad other constituent and interest groups, it should look at the positive side. Congress has the opportunity—if it seizes the day--to fix its mortgage finance roof when it’s bright and sunny and not raining.


CWJC et al, Not Needed, Too Complicated

The nation’s mortgage markets don’t need the kind omnibus overhaul many mindlessly are demanding because advocates misunderstand mortgage finance or its diverse politics and are hung up on the false GSE fictions from 10 or more years ago.

Obama Opportunity 

This would be a perfect time for the Obama Administration to remove Uncle Sam’s teat from the big banker’s lips and use its bully pulpit to support a regulatory revival of F&F, letting the GSEs retain some/part/all of their current earnings for their necessary recapitalization. 

The two are healthy, sending money to the General Fund, and Congress has no real momentum to do them in and give away the mortgage market to the big banks (nor should they!). 

To appreciate the scale of the big bank corruption  and systemic degradation, count all of the fines and penalties that the big guys have paid Uncle Sam—in the past two years, mainly for screwing over Fannie and Freddie --and then add to that number the more $700 Billion the banks lost on their own subprime private label mortgage backed securities (PLS) misadventures, done outside of the F&F systems, and  you have pretty stark evidence about which institutions do not deserve to be handed functional control of the nation’s mortgage markets. 

The link above doesn’t include the recent BoA reported $17 Billion fine and Citicorp’s reported $15 Billion payment to the government.


Ignore All But Limited Fixes

Every business day Fannie and Freddie operationally work--and, with primary market lenders--supporting American families needing mortgage loans. 

If required--and I have no issue with it--legislation can be written to explain that the Treasury/Fed won’t come a running if there are any future mortgage market problems (which should be marginal as long as the two only securitize or occasionally buy QM loans).


Congress Would Make TBTF Banks Bigger  

The silly thing is how much Congress rails against Fannie and Freddie and professes concern about “preventing the next time,” while, simultaneously, cobbling and proposing new legislative mortgage arrangements for the nation’s biggest banks which everyone knows already are “too big to fail” and don’t evidence anywhere near the regulatory and financial control the government holds over the two mortgage giants. (Oh, and the Senate bill would add still another level of regulation on the big banks with its Federal Mortgage Insurance Corporation.) 

Is that just congressional hypocrisy or idiocy? 

Iraq and Obama 

No matter what President Obama does in his term’s remainder, his critics will vilify him for being too late, too lame, too aggressive, too Black (oops), or something. 

As I keep reminding the President, no matter what you do in DC you’ll be killed for being a sheep or a wolf; you are not running, again, so don’t be anyone’s lamb chop.

Someone has to start a pushback to IS/ISIS/ISIL and it might as well be us, minus the boots on the ground (although we all know we have Special Forces types all over the place, killing folks and siting for attack planes).

Take all the help you can get from the governments of Britain, France, Germany, the Saudi’s, Lebanon, Turkey, certainly Iraq, the Kurds and even Iran—the last few being your effort's needed foot soldiers--and have them make it lavish—or their heads could join those poor IS victims, already violated. 

And remind the Russians—whom you never should trust—that they have some internal Muslim concerns themselves. If they want to kick in some help, keep the nesting dolls, but divert a few hundred Spetsnatz and their military supplies now headed for the Ukraine (or even pull a few out of Syria).

What Others Are Saying 

Joe Light writes about F&F earnings in the WSJ.

Rob Garver, writing for Yahoo, notes that the DoJ and Treasury might have discovered a major new tool to pursue banks for financial shenanigans, as illustrated by the reported $17 Billion Bank of America (BOA) fines/payments to the US.


Thoughtful piece by NYT’s Binyamin Appelbaum on Stanford University finance professor Anat Admanti, an academic who scares banks. 

The New York Times editorializes on Sunday about the faint of heart federal financial regulators overseeing the TBTF banks. (Regulators captured by the banks? Don’t those editors read my blog?)


The Progressive Policy Institute (PPI) opines on F&F legislative steps or lack thereof. (Read through to comments.)

WaPo attempts to read the President’s mortgage thoughts. (Read through to comments.)


Maloni, 8-11-2014