Monday, November 26, 2018

Mainly GSE observations, but one Trump pronouncement


  
GSE Cats and Dogs and One Big Turkey


Stuff

While the GSE legal wheels grind ever so slowly and we’ve just had a major congressional election in which House Democrats keep adding to their 2018 winning totals, as the Senate GOP added to its don’t look for much generic legislative action in the coming lame duck session (ending @Dec. 15).

Everything starts all over again after the new crew (and the winning incumbents) are swoon in January 2019.

The Senate R’s--for the rest of this year only--have a 2 vote spread and who knows how Senators Flake (Ariz.) and Murkowski (R-Alas.), or even Collins (R-Me) will vote on anything President Trump wants?

Susan Collins likely has politically taken on the “dead woman walking” stance, given all of the Conservative and GOP adulations she earned with her vote for Judge Kavanaugh to the Supreme Court. Maine long knives appear out for her in Maine’s 2020 Senatorial election as her state and the entire New England region take on a distinct blue political hue.

I assume Rep. Maxine Waters (D-Cal.) will be voted Chair of the House Financial Institutions Committee, a large, sprawling matter with some 75 members.

The exact Banking Committee member total won’t be revealed until the two party caucuses in January decide committee membership and the freshmen Members test their likes and dislikes of their committee assignments.

One small positive I do know is some new Members, interested in GSE matters, are “seeking” service on the Committee just to pursue Fannie/Freddie matters.

That’s helpful, just having attentive new women and men is very positive.

But, just as in high school, they still will have little authority and need spend time learning their new “trade,” but trying to understand Fannie/Freddie mortgage issues is better than just consuming the standard anti-GSE pablum that’s been spun for years by the institutional bad guys and R Committee leaders.

FHFA Capital Regulations

Most of those commenting on the Federal Housing Finance Agency (FHFA) proposed GSE risk-based capital regulations have filed their opinions. People smarter than I are parsing them and—I am certain—soon will issue their interpretive synopsis in a way that most of us can grasp them.

A simple test for all comments (whether trade group, think tank, or individuals) is if—as most GSE critics do—the position guilelessly proposes higher Fannie Mae and Freddie Mac capital levels, i.e. equal to commercial banks or higher, their agenda is not positive or productive.

At the more moderate end is Tim Howard who believes that “risk-based” means risk-based and the GSEs exclusively acquiring or securitizing variations of single and multi-family mortgages have easily definable risks, with precise predictable data captured via the voluminous loan performance history and comprehensive tracking of the credit and interest rate risks the two take.

That element/resource, alone, should produce capital levels below that of commercial banks.

Tim’s thinking—which I support--swims a little uphill when for competitive or political reasons, FHFA and other policymakers –camouflage their true intent-- by falling back on the ass covering meme “more capital is better.”

But, there is a cost—in this case higher mortgage rates and less affordability—with inflated GSE capital requirements.

The RBC regs and related matters all will be tied up by the WH seeking a successor to current Director Mel Watt, whose term ends next year in early January. (Mark Calabria, the VP's economist had his name mentioned as a possible successor, again today, by Inside Mortgage Finance.)

John Carney and Breitbart…strike again

Rattling around the dark corners and annexes of Breitbart News, John Carney still is aiming his poison darts at the GSEs and anyone he deems evil enough to support their operation.

Most recently he went after “hedge funds.”

Carney’s current outrage is aimed at the “Moelis plan,” a GSE reform proposal, birthed on Wall Street,  which has been circulating inside Washington for  the past year, and has picked up quiet bipartisan support (and to Carney’s horrors, some in the Trump Treasury), which among other virtues contemplates support for GSE low income family lending.

Here’s the article's link, but let me point out some continued blind spots for Mr. Carney which seem to never get printed under his name as if acknowledging them undercuts his value to naysayers.

https://www.breitbart.com/economy/2018/11/21/carney-hedge-funds-are-manuevering-to-loot-fannie-and-freddie-from-the-u-s-taxpayer/

Carney, while brutalizing the GSEs, never mentions the far greater, commercial bank private MBS (or private label securities) actions, which tried to clone GSEs success but with less responsible products and services, and produced a far greater hit to US taxpayers in the 2008 financial debacle.

How can John indict one and ignore the far worse bank “other” or fail to mention that the banks had much deeper emergency financial relief, estimated in the $Trillions, at both Treasury and the Federal Reserve??

The larger bank failures disgorged buckets of red ink, but the GSEs had less friendly support in Treasury and—as the many court cases he disparages—suggest, TreasuryFHFA actively manipulated Fannie’s and Freddie’s books to make them appear financially far weaker than they were.

If Carney were not writing only for a slow-witted a scalawag group, he openly and honestly would discuss the nation’s largest banks. His bank friends were charged only half the repayment rate (5%) by the friendly Treasury Secretary Hank Paulson that forced twice that toll (10%) on Fannie and Freddie. (See any slant/preference there, John?)


As the GSEs recovered,  the Obama Treasury manipulated the original repayments scheme in 2012 to confiscate all future GSE earnings, save a capital sliver, let me repeat “all future GSE earnings”—so that they original GSE debt of @$190 Billion now has generated @$280 Billion for taxpayers….and the payback still is increasing in perpetuity??

How little is Carney aware or is it just plain dishonesty, when he also disparages the GSEs but extolls poor Wells Fargo Bank and says they’ve stayed out of most inside the Beltway machinations.

Wrong, John!

Wells has been dancing in an out of their own lawsuits for years, while working quite assiduously—primarily through the Mortgage Bankers Association (MBA)—to develop its own "cripple the GSEs scheme," far friendlier to the nation’s biggest banks than to the nations’ consumers.

Treasury does own 79.9% of the GSEs, and that money and possibly more, easily can wind up back in the US Treasury serving US taxpayers, if Admin gets behind a plan (Moelis?) which keeps the GSEs alive and be a superb resolution for the nation’s consumers.

DJT offers up a real leadership Thanksgiving “Turkey”

It’s OK President Trump to break tradition, refuse to travel to any combat zone and visit  US Troops—since walking from the plane could irritate your bone spurs--but instead take the easy way and substitute a telephone call, made from your safe, warm, palatial Mara Lago resort property.

Proceed briefly to thank the troops and then boorishly switch and talk about yourself, your personal priorities, and your self-analysis of your perceived successes.

I am certain your expert bloviating kept our kids safe and our Al Queda, ISIS, North Korean, Russian, Iranian military opponents quivering in hiding, too frightened to engage, wound, and kill these G.I.s serving worldwide, while you eat turkey, Big Macs and play rounds of golf with Jack Nicklaus.

In the immortal words of George W. Bush, with a huge dash of sarcasm thrown in, “Good work, Brownie!” (Get someone to explain that reference to you, sir.)


Maloni, 11-26-2018




12 comments:

Unknown said...

Thx as usual, Maloni

Bill Maloni said...

Thanks for reading, Joe.

Anonymous said...

On August 20, 2018 Bill Maloni said...‬

‪For several of the same reasons, I would support Attorney Michael Avenatti in a D presidential primary‬.

From your favorite newspaper.

https://www.washingtonpost.com/politics/stormy-daniels-says-michael-avenatti-filed-defamation-suit-against-her-wishes/2018/11/28/6dd31dac-f358-11e8-bc79-68604ed88993_story.html?noredirect=on&utm_term=.64314d5b1572

Anonymous said...

President Trump isn’t 10 times or 100 times more brilliant then any President in our lifetime, he is beyond measure. His moves are with strategic precision in regards to Foreign Policy, the Economy, Working Class, Minorities, Big Labor, Military and Law Enforcers. Actually to many to list. He is rough around the edges but in a unique league of his own. Winning.

Bill Maloni said...

Anon—I had almost 400 hits and hadn’t heard from you. I was worried you had forsaken me.

"Rough around the edges?"

What kind of sissy analysis is that? Oh and please define it in your next comment.

DJT is an insecure, misogynist, a bigot, a "nationalist" (who doesn't have the education/history to understand what the word means), stilt thinks "there were good people on both sides of Charlottesville, has presided over more anger and hostility in his two years than most Presidents have in four or even eight, disparages his own appointees (who does he think named them to those jobs), confuses fear driven adoration with respect.

He doesn’t yet grasp the history and role of the federal government or that it isn’t his personal playpen (Sad!). And, he’s played more golf than Obama ever dreamed of doing and lies about that and many other things, daily.

He's a major risk to our nation and the November election results--please don’t tell me about the three Senate seats, but talk about the 40 plus D House wins--suggests the nation is tiring of him and his sad act.

I think he emotionally implodes before his term ends.

Other than that, I agree with you on Avennatti!

“Anon and Bill for Avennatti” would make for a nice bumper sticker.

Anonymous said...

The phony fraud you endorsed for President got on the two Liberal Networks almost 100 times. See anything odd about that? With all good things, the truth comes out.

President Trump a Nationalist, absolutely.

Insecure, thats laughable actually. He has more strength to take the daily beatings he gets then any man I ever knew.

Yea, just a big dummy to beat 17 seasoned Republicans and the most corrupt person in the history of our country, and a net worth of $10 billion. Must be those Russians. It’s so laughable it’s actually sad.

Foreign Policy-
-What has “any” President done to bring NK to stop testing and come to the table?
-What has “any” President done to stop the pilferage of our IP?
-What has “any” President done to get useless NATO to “pay up?
-What has “any” President done to move the US Embassy to Jerusalem and recognize it as Israel’s Capital?
The list could continue but you get the jest. Most are talk. Democrats and Republicans.

Economy-
Do I really need to write anything? If you can’t see the GDP growth, unemployment, companies moving back to US, record low Black, Hispanic and Women working then you may be in a cloud.

Working Class-
Have wages went up more in the past year then the past two decades?

Labor-
Hmmmm. Let’s see. Who is building those Sky Scrapers, Automobiles? Their Leadership is for the DNC but the membership is definitely not. Soon, same will happen with Blacks, Hispanics and Jews. Sooner then you think. Many will leave the DNC Plantation for Freedom.

Military and Law Enforcers-
If you don’t hear the Presidents words or see the funding, then what can I say?

When you do “your bias” analysis, why not acknowledge the change in House seats under Obumer or “I didn’t have sexual reactions with that (21 year old) woman”?

Yea, just a big dummy to beat 17 seasoned Republicans and the most corrupt person in the history of our country, and a net worth of $10 billion. Must be those Russians. It’s so laughable it’s actually sad.

Here is an analysis of 289 accomplishments.
https://www.washingtonexaminer.com/washington-secrets/trumps-list-289-accomplishments-in-just-20-months-relentless-promise-keeping

Bill Maloni said...

Sorry, I am a "reasonable thinker" ergo I reject anything in Breitbart, the Washington Examiner, plus Fox.
Get me some middle of the road sources and I'll read them.
Jews?
I don’t' care about Jared and Ivanka, when Daddy said there were "good people of both sides of the Charlottesville" incident, he lost a lot of Jews, not to mention the intelligent Jewish women who think he is a rank misogynist and general pig.

What will Black and Hispanics find in the GOP and why hasn't the Republican Party ever before attracted them in numbers? The party and the minorities have been there for a long time, but NADA on connecting.
Trump demeans both groups sometime using code words and sometimes not, whenever he gets a chance. It's part of a very deep public record; see if you can find that in Breitbart, the Examiner, or on Faux, I mean Fox.
Even you can answer that.
Look at the new Mississippi Senator and his support for her and why, you'll see part of your answer.
Trump's a moral coward, with no principles, except Trump-love.
Why not dump Saudi Arabia for its behavior (not just Khashoggi but the fact that 15 of the 9-11 attackers were from there?) It’s a joke to think they can stand up to the Iranian military.
Just because the Trump family wants the Saudis as personal business partners, what do we--the US--get from their bizarre fratricidal behavior among the many competiting Princes?
I see your military funding but what "president's words". Those pussy phone call words. The disdain for foreign allies, which h we need if we ever do go to major war, again?
Words have meanings and consequences and this guy has major loose lips and vomits his base opinions without a thought for how they land and who they hurt.

(If you are contemplating a Christmas exchange, I am a 44 Regular and red is one of my favorite colors?)

Bill Maloni said...

Anon-

Try this on for size.
It's from CNN but the interviewee is former Fox News analyst, Ralph Peters, retired military.

https://www.cnn.com/videos/politics/2018/11/29/ralph-peters-cowards-not-listening-tapes-sot-ac360-vpx.cnn

Bill Maloni said...

Anon--

Watch the guy you name one of the nation's "greatest Presidents" riggle out of this one, too.

https://www.cnn.com/2018/11/29/politics/michael-cohen-guilty-plea-misleading-congress/index.html

Do you have that sinking feeling yet?

Anonymous said...

Your hate and loathing identifies a lot about you.
No sinking feeling. None. Trump has gotten past WAY bigger issues. It’s a nothing burger.
I know you are who you are and no way of changing your thought process. Like a employee who gets a Christmas bonus and bitches about the tax. I write because of the readers of the Blog, many that look up to you for your GSE insight but don’t agree with your political ideology.
I would think your favorite color is Blue?

Bill Maloni said...

Anon--I enjoy our exchanges, nothing personal.

Blue does appeal to me, but in my career/experience, you can't be a true success working just one side of the street.

I find President Trump objectionable on many levels and would if I met him in his pre-presidential career, too.

You will love my next blog, already in the can and almost zero DJT references.

(If you are hinting you are giving me a Christmas bonus, I promise not to bitch about the taxes I'll bneed to pay.)

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