Tag Archives: Freddie Mac

Gay Liberal Rep. Barney Frank Calls it Quits: Good Riddance

After 32 long years of representing Massachusetts District 04 in the U.S. House of Representatives, Congressman Barney Frank has announced he will not be running for reelection in 2012. The openly gay Liberal (see fake Democrat) says his new district lines would force him to campaign aggressively, a task his 71 year old body may not be up to handling any longer. With the other half of the Dodd-Frank financial reform bill, Chris Dodd out in California working as a stealth lobbyist for the Hollywood motion picture association, now both [supposed] financial reform architects will be far away from DC by the time the real nasty elements of the Dodd-Frank bill start to be enforced in the coming years.

Photo: Saul Loeb/AFP/Getty Images

When researching other articles about Frank’s retirement, there was one disgusting pattern of irresponsibility in pushing of the gay lifestyle embedded in many of the so called news articles. Being an effective legislator is one thing, but celebrating someone’s perversions of sexual relationships such as in the same sex lifestyle of Barney Frank, as being supposedly some kind of heroic example for our children to follow is a disgusting bunch of societal manipulation that should be called out every time it rears it’s ugly, perverted head in our society today! While the ignorant puppet-parrots of the left might not mind their children going to sleep with visions of Barney Frank mounting his man-child lover whom worked at Fannie Mae, or vice-versa, as in gay Liberal Barney Frank being mounted by his man-child lover, you sick, demented, perverted parasites of the left need to keep your queer lifestyles out of all of America’s children’s lives and schools. Parents, you need to pay attention more so than ever today. For those of you who want grandchildren from your own bloodlines, maybe you should be teaching your children about how the fact that them giving you authentic grandchildren of your bloodlines and lineage becomes an impossibility when 2 men or 2 women marry each other.

Gay Liberal Barney Frank is getting out of Congress right before many of his Dodd-Frank financial rules take effect. His bed-pal (pun intended) in the Dodd-Frank bill has already high-tailed it out of DC. The Dodd-Frank [supposed] financial reform bill has some nasty elements yet to be exposed, and gay-boy-lover Frank does not want to be around when those facts come to light.The Dodd-Frank {supposed} financial reform, bill did not address the biggest fraud that caused the housing crash of 2008 in the first place: Fannie Mae and Freddie Mac and Progressives everyone-deserves-a-house-regardless-of-
proven-ability-to-pay vote-begging schemes of the 2006-2008 elections. Yes, the Progressive Gay Liberal Barney Frank is finally retiring from Congress.

Good frigging riddance!

Newt Gingrich and Freddie Mac – MSM Hit Piece?


We hear quite a bit from the MSM about Newt Gingrich’s ties to Freddie Mac. Newt Gingrich acknowledged on Wednesday, November 16, 2011, that his company, The Gingrich Group, had received consulting fees of between $1.6 million and $1.8 million from mortgage giant Freddie Mac over eight years for providing “strategic advice.” A Freddie Mac spokesperson said Gingrich was a consultant, not a lobbyist for the firm. “The Gingrich Group offered strategic advice to a wide variety of clients about a wide variety of issues, including IBM, Microsoft, the U.S. Chamber of Commerce and more,” Gingrich’s campaign said in a statement. “Gingrich Group fees were comparable to that of many consulting firms.” Gingrich’s first contract with Freddie Mac began five months after he resigned in 1999 from Congress and as speaker of the House of Representatives. His last contract ended in 2008.

The biggest damage to his credibility could come from how he has blasted Freddie Mac and Fannie Mae in 2008, demanding that President Obama and other members of Congress return the money they received from them, and more recently said Democrats like Rep. Barney Frank should be jailed for having ties with lobbyists at those organizations. But the cited source did NOT distinguish between contributions and fees.

So, with the MSM focusing on Newt Gingrich, let’s see of what other opportunities the MSM may have availed themselves.

Freddie Mac CEO Charles E. Haldeman Jr. received a base salary of $900,000, and took home an additional $2.3 million in bonus pay. He stands to make as much as $6 million in 2011. Leland C. Brendsel (Freddie Mac CEO 1987-03) took home more than $28.4 million from 1993 to 2003. Richard Syron (Freddie Mac CEO, 2003-08) earned more than $38 million in compensation while he was CEO. Syron collected $19.8 million of this pay in 2007 alone, the year before the enterprise went into conservatorship.

This source elaborates on the Obama-Freddie Mac/Fannie Mae connection.

After Barack Obama was nominated by the Democrat party, he asked, among others, Jim Johnson, Fannie Mae CEO from 1991 to 1998, to help him search for a vice presidential candidate. Johnson made $21 million in one year from Fannie-Mae.

President Barack Obama had numerous connections with Franklin Raines, Fannie Mae CEO from 1999 to 2004. Raines received $90 million from Fannie Mae, and he gets a pension of over $1.2 million per year. Obama received thousands of dollars in campaign donations from Fannie Mae.

Jamie Gorelick, best known for her “wall” memo, was vice chairman of Fannie Mae when it began bundling subprime loans into securitized financial instruments. She received a bonus of $779,625 in 1998 alone, after it was discovered that Fannie Mae employees falsified signatures on accounting transactions that helped the company meet earnings targets for 1998, a “manipulation” that triggered multimillion-dollar bonuses for top executives. She was paid was paid $26,466,834 in salary, bonuses, performance pay and stock options from 1998 to 2003.

Fannie Mae Chief Financial Officer J. Timothy Howard received $493,750 in 1998. Howard was ousted by the Fannie Mae board in December, 2004, after the chief accountant of the Securities and Exchange Commission (SEC) agreed with the head of the Office of Federal Housing Enterprise Oversight’s (OFHEO) criticism of the company’s accounting, including the 1998 bonus maneuver. Howard, whose resignation is officially viewed as a retirement, stands to get an annual pension of more than $400,000, plus lifetime access to Fannie Mae’s medical benefits. He is also owed more than $4 million in stock options.

So I guess the bottom line is that, before it starts doing stories on the Newt Gingrich/Freddie Mac connection and all the money Newt made, it has PLENTY of other opportunities to do stories on other Freddie Mac/Fannie Mae executives who “made” much more money than Newt did.

BTW, this article is in no way a defense of what Newt Gingrich did. It simply illustrates how the MSM can, through selective reporting, manipulate most of the U.S. population.

But that’s just my opinion.

And, yes, I have read Reckless Endangerment: How Outsized Ambition, Greed, and Corruption Led to Economic Armageddon, by Gretchen Morgenson and Joshua Rosner. I highly recommend it.

Fannie, Freddie CEOs Ask For More Taxpayer Money, Defend Bonuses

The Federal Housing Finance Agency (FHFA), whose current acting director is Edward DeMarco, is the regulator and conservator of the Federal National Mortgage Association (FNMA or Fannie Mae) and the Federal Home Loan Mortgage Corporation (FHLMC or Freddie Mac). Fannie Mae lost $14 billion in FY2010, while Freddie Mac lost $21.5 billion in FY2009. Fannie Mae says it will seek $7.8 billion in Treasury Department aid. Freddie Mac has requested an additional $6 billion from US taxpayers.

Now that the stage has been set, let’s examine WHY Fannie Mae and Freddie Mac are in the news. On Wednesday, November 16, 2011, Representative Darrell Issa (R-CA) had Fannie Mae CEO Michael Williams and Freddie Mac CEO Charles “Ed” Haldeman Jr. to testify before the House Oversight and Government Reform Committee. They were there to defend their salaries. Each of them could take home as much as $6 million apiece in salary and bonuses in 2011. Fannie and Freddie payed out nearly $13 million in executive bonuses in 2010. “It’s hard for them [taxpayers] to understand how executives get $6 million in pay for a failing entity,” said Rep. Carolyn Maloney (D-NY). The salary and bonuses were defended by Williams, Haldeman and Edward DeMarco. DeMarco, defending the salaries and bonuses, said that it was difficult to find qualified people to help run the companies. The CEOs of Fannie Mae and Freddie Mac argued the compensation structures at the mortgage finance firms were needed to retain and attract qualified staff.   (Personal note: how can “qualified staff” lose billions of dollars?)

A House committee approved a suspension of bonus packages for executives at Fannie Mae and Freddie Mac. “Awarding lavish pay packages to the heads of these companies that have accepted $170 billion in taxpayer cash can’t be defended,” said Representative Spencer Bachus (R-AL), chairman of the House Financial Services Committee, and sponsor of the bill to limit bonuses. The committee approved the measure 52-4, sending it to the House floor.

All of this comes amid the Obama administration’s effort to increase mortgage refinancing. White House officials are easing the rules of the Home Affordable Refinance Program (HARP), which allows mortgages backed by Fannie Mae and Freddie Mac to be refinanced at lower rates.  (Another personal note: does anyone see any irony here?)

Heil Obama: Is This America’s Future?

We are finding the anointed one, Barak Obama, gaining confidence in his ability to circumvent the Constitution and Congress to implement any rule he desires.  In the last week he has gone on the campaign trail, at taxpayer expense of course, to tell We the People that if Congress is reticent in its willingness to implement the changes he wants that he will do it by executive order, in spite of what the Constitution says. He first suggested he would bypass Congress to implement new home loan guarantees backed by Freddie Mac and Fannie Mae, at the expense of We the People of course, and now has floated the idea that he will minimize payment requirements or forgive student loans by executive order.  Of course, when you get to the meat of the student loan idea it turns out to be a lie to deceive them.  Obama wants to bypass Congress to get the support of these student loan people but not really help them when the rubber meets the road.

I find it alarming that Obama sees himself as the only arbiter of law in the United States, and that he believes he can totally bypass Congress and implement anything he wants to implement.  Does anyone besides me see any similarities to despots around the world, past and present?  Obama’s own party has refused to consider his “jobs bill”, and they aren’t likely to jump into the middle of this rerun of the housing problem this close to an election.  I believe that Democrats in Congress, or at least most of them, see the handwriting on the wall and fear another shellacking like 2010 coming.  Have you noticed there are no sponsors of this “jobs bill” in either house of Congress, not even from Democrats?  If the Republicans, who only have 47 votes in the Senate, are willing to vote on Obama’s “jobs bill” why doesn’t Harry Reid bring it to the floor for that vote?  Could it be that Reid doesn’t want to put Democrats on the spot, knowing that this tax hike disguised as a “jobs bill” is a disaster waiting to happen?

I find it interesting that the same people who called George W. Bush a fascist support the government funding of banks, stock brokerage houses, and automobile companies.  When the government bailed out the automobile companies the unions received the bulk of the money.  Taxpayers and secured bondholders, those first in line by law, got the shaft.  When the government bailed out the banks and brokerages much of the money went to branches or subsidiaries outside the country, and what stayed in the country went to those in charge of the companies in the form of huge bonuses, financed by We the people.  Now the billions of taxpayer money that have been sunk into the phony “green energy” companies go to shareholders, people like George Kaiser, a billionaire and bundler for Barak Obama.  Kaiser says he never spoke to anyone in the Obama administration about Solyndra, and it probably can’t be proven whether he did or did not have those conversations, but it certainly doesn’t pass the smell test with this taxpayer.  Since the Solyndra scandal surfaced we find cases of other companies in the same situation and our tax money supporting those who have questionable ties to government officials.  Is this a case of crony capitalism helping with the process of destroying capitalism?

We face a danger not previously seen in my lifetime and too many people either can’t or won’t see what is going on.  The very people in the Democrat Party who decried the TEA Party, i.e. Barak Obama and Nancy Pelosi, as Nazi’s and violent angry mobs see the Wall Street protestors as patriots, true American heroes standing up for their “rights”.  It is truly amazing to me to see the contrast between the TEA Party rallies and this mob of morons.  When you look at the litter, public sexual activity, public nudity, open drug trafficking and use, defecating on police cars in the Wall Street protests, and don’t get me started on the interviews with the media, I find the contrast to the TEA Party rallies to be staggering.

The Wall Street nuts are a problem but not our main problem.  Those people are only the pawns, the “useful idiots”, of those who seek to enslave all of us, including those protesting.  I wonder why they aren’t in Washington protesting against the graft and corruption that is so apparent that they should be able to see it easily and clearly.

Governor Beverly Perdue of North Carolina, Jesse Jackson Jr., Maxine Waters, Sheila Jackson Lee, and their ilk are also a part of our problem.  And how about the Congressman from Georgia, Hank Johnson, who is afraid Guam will “tip over and capsize” if we put too many Marines on it?

 

The people who have called for Obama to suspend elections, suspend the Constitution, and just “do what he needs to do” are part of the problem.  These people advocate the idea of throwing our system of government away to suit their Marxist ideology, with them in control of course.

Another part of the problem is the deafening silence from Republicans.  Obama threatens to bypass Congress, taking actions that are clearly outside his grounds according to the Constitution of the United States of America and they say little or nothing.  Why are they silent?  Are they afraid of being called racists or are they willing accomplices to his tyranny?  Anyone see Venezuela coming our way?

 

Governing does not include passing out edicts to get things done.  It seems to me we had a disagreement with King George III about edicts and became a free and autonomous country as a result.  The freedom of the United States of America was won, and has been sustained, at a terrible cost in lives and property but it was won because We the People decided freedom was worth fighting for.

Today we face the same kind of tyranny.  We find ourselves living at the whim of bureaucrats who make rules without any regard to the law of the land.  If they can’t get what they want by legislation they get it by fiat regulation and Obama ignores court decisions that don’t suit him, as in the Gulf of Mexico drilling issue.  We have politicians who pass legislation without reading the content and then tell us that they are doing this “for our own good” and that we “don’t know how to best live our lives”.

I have recently discovered that the federal government is going to take complete control of ALL radio and television signals for 3 minutes on November 9, 2011 to test the new National Emergency Alert System.  As an older citizen I am familiar with these tests as they have been going on for many years.  The difference is that instead of testing at the local level as has been done in the past this one is going to be a national test, controlled by federal government officials, with government agencies taking control of every signal emitted throughout the nation.  When the system was started the federal government notified state and local governments of an issue and they sent out the emergency notifications.  Now we have FEMA, Department of Homeland Security (what a misnomer), and other federal agencies in direct control of our over-the-air communications.

Is this an answer to the calls by Democrats for the suspension of the Constitution, suspension of Congress, and hints of the implementation of martial law?  Is this more preparation for use of the FEMA camps that have been built across the nation?  Add this to the attempt by Joe Leiberman and Susan Collins to give Obama authority to seize control of the internet on a whim (S. 3480) and you have a cocktail for disaster for We the People and the freedom we have known for generations, a freedom paid for in blood and death by generations of our predecessors.

The communistic style of government in America has been growing for many years while We the People slept. They seem to think they now have within their grasp the final step needed to take over our nation and install the tyrannical government they have been working towards.  Taken one at a time these things are frightening but when I put them together I find a conspiratorial plan to subvert our way of life, our form of government, and replace it with an oligarchy such as in Venezuela, Cuba, North Korea, China, Iran, Saudi Arabia, and other despotic kingdoms.

We find ourselves at a crossroads.  Do we continue down the left fork to tyranny, despotism, and slavery, or do we move over to the right fork and fight for freedom once again?  Obama, his 47 Czars, Democrats, and all too many Republicans are on a path to install the oligarchy they desire.  They believe they can do so without any real protest from We the People.

Will you sit idly by until you have no choice but to accept the globalist elites who desire to control every aspect of your life?  If you don’t have a job now you will when America is a dictatorship.  Of course it won’t be a good paying job, probably not a paying job at all, and you won’t have your own house, your own car, a bank account or the freedom to come and go as you wish.

I have seen the results of tyranny in many places around the world.  A nation can go from wealthy to poor, from freedom to slavery in a very short time once tyrants gain control.  We are not far from that point and when Barak Obama and his minions gain the level of control they want it is over for all of We the People, not just the rich.  As a matter of fact, if you look around, the rich are the ones who will come out good because they have the money to buy their freedom, I don’t.

It is past time to stand up and be counted. We can no longer afford to “hope” for “change” in a nation that is teetering on the edge of tyranny.  Acceptance of a mediocre candidate to oppose Obama is not enough to insure the freedom of future generations.

I submit this in the name of the Most Holy Trinity, in faith, with the responsibility given to me by Almighty God to honor His work and not let it die from neglect.

 

Bob Russell
Claremore, Oklahoma
Oct. 27, 2011

Obama's 'Underwater' Homeowner Rescue Already Sinking

President Obama is travelling several Western states to talk up a re-vamp of his failed “Home Affordable Refinance Program” (HARP) in another big-government attempt to rescue homeowners who owe more on their houses than the real estate is worth.

Beginning in Nevada, the “We Can’t Wait” campaign is intended to show-up Congress while side-stepping them completely. Congress had passed HARP in an effort to help homeowners with troubled mortgages. The program promised to help about 5 million Americans, but in truth just  822,000 have been assisted – not even 10% of those upside-down on their home loans.

The new rules in “HARP Phase II” will loosen the rules on who can take advantage of the government program and reduce the fees the borrower must pay.

 Eliminating certain risk-based fees for borrowers who refinance into shorter-term mortgages and lowering fees for other borrowers;
 Removing the current 125 percent LTV ceiling for fixed-rate mortgages backed by Fannie Mae and Freddie Mac;
 Waiving certain representations and warranties that lenders commit to in making loans owned or guaranteed by Fannie Mae and Freddie Mac;
 Eliminating the need for a new property appraisal where there is a reliable AVM (automated valuation model) estimate provided by the Enterprises; and
 Extending the end date for HARP until Dec. 31, 2013 for loans originally sold to the Enterprises on or before May 31, 2009.

In the original program, only those that owed up to 125% more than the property was worth could be accepted into the program. Now, there will be no limit to the amount the borrower may owe in relation to the value of the property.

If Jim, as an example, owed $250,000 on his house and the home was only worth $175,000, he previously would have  been denied a re-finance under the HARP program. Now, as long as Jim’s loan is backed by Fannie Mae/Freddie Mac, he can be approved. This will put the taxpayers on the hook for a quarter million dollars with only 175k in collateral. Who runs a business this way?

The program is also expected to only provide minimal relief. Due to the 20 year maximum term for the refinanced mortgage, monthly payments may only be 20-30 dollars less per month according to an example provided by the Federal Housing Finance Agency (FHFA).

If the borrower chose a 20-year loan term at a rate of 4.25 percent (mortgage rates tend to be less for shorter term mortgages), the monthly payment would be $1238 ($26 less than the borrower currently pays) and the borrower’s loan balance would reach $160,000 in five-and-one-half years

The real purpose of the new program may be even more deserving of investigation. This program doesn’t appear to modify existing loans. Instead, it replaces one loan for another. It’s  a traditional re-finance with one major difference – Fannie and Freddie are letting the banks off the hook for any illegitimate loans they originated as long as they re-fi through this program. David Dayen at FDL puts it succinctly:

So, earlier, I said “what’s not to like.” Here’s what’s not to like. The “reps and warranties” part of this. When you refinance a loan, you’re essentially creating a new mortgage, unlike a loan modification, where you modify the old mortgage. Under the plan, the FHFA will eliminate their ability to force repurchases on these old loans, and they would lower their ability to force repurchases on the new loans created. There will be a “modest fee” associated with relieving these reps and warranties, according to Donovan, which won’t be set until November 15. They will be lower than the current risk-based fees that Fannie and Freddie charge.

What does this mean? A “reps and warranties” case is a case where the loan was originated improperly. When Fannie and Freddie get sold a bad loan like this, they have the right to force it back on the originator. New lenders are reluctant to refinance such loans, because they become liable for the put-back.

What this means is that FHFA will essentially settle on all the loans that get refinanced for a “modest fee,” which we can safely assume will be next to nothing. And we know that a substantial amount of loans, perhaps a majority, were illegally originated during the bubble years. You’re letting the lenders who originated the loans off the hook for that, in exchange for allowing more refis.

FHFA estimates that this program may double the current number of re-finances by the end of 2013. An additional $447 Billion to help perhaps another 882,000 home owners over the next two years?  That’s more than half-a-million dollars per re-finance. Remember, they aren’t giving them half-a-million bucks, that’s just what Obama’s program costs to service 882,000 loans by the FHFA estimate.

“We Can’t Wait” may be yet another attempt to do anything quickly, no matter how ill-conceived it may be. Of some concern is where did the money to fund this come from if Congress didn’t approve it?

At a cost of $447 Billion this is a bank rescue and a move to prop up inflated real-estate prices all under the disguise of helping home owners. This ought to push the Occupy Wall Street crowd right over the edge .. but it won’t – because it came from Democrats.

 

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Government Causes Housing Crash Then Sues Everyone Else

housing crisisThe U.S. government on Friday sued 17 banking firms for their roles in the housing crash. The financial institutions are being accused of selling $196 billion dollars of now-toxic mortgage backed securities to Fannie Mae and Freddie Mac.

The Federal Housing Agency (FHA) filed suits against Bank of America, Citigroup, JP Morgan chase and 14 others. FHA is the government agency that oversees Fannie and Freddie which raises questions. Is this just a maneuver for Fannie and Freddie to recover some portion of the massive losses that they were responsible for taking on?

Fannie and Freddie have notoriously backed loans with questionable characteristics. So-called NJNA (no job no assets) loans and loans where the borrower was likely borrowing more than they could afford. This created the easy credit climate where banks, under pressure from regulators and community groups like ACORN, were pressed to make sub-prime loans. Now, the government is coming after them.

The law suits will likely have a chilling effect on the economy. Banks as a whole will now be even more timid about being involved with FHA loans that are backed by Fannie and Freddie in fear of reprisals in coming years should the housing crisis worsen.

The banks have spent the last three years rebuilding their balance sheets. Now, the legal fallout from the mortgage crisis is creating a new wave of liabilities for them and uncertainty for the financial system. News that the economy added no jobs in August and that the lawsuits were pending slammed the stock market Friday and sent bank stocks tumbling. – The Wall Street Journal

Making it more difficult for home buyers to get loans will continue to weaken housing demand and depress prices. Current home owners will continue to see their equity, and therefor personal wealth, dwindle.

Bank were pressured by progressive groups and Democrat lawmakers to make loans to lower-income buyers that in many cases could not afford the homes they were buying. In order to defray the risk, financial institutions then packaged up those mortgages into mortgage-backed securities (MBS) which Fannie and Freddie then bought – as did many other institutions.

The suits are specific to the mortgage-backed securities sold to Fannie and Freddie stating that the banks misrepresented that the securities met the FHA’s underwriting rules and overstated the ability of the borrowers to repay the loans.

While the President needs the banking industry to loosen lending rules to create any semblance of a recovery, having his administration go after the largest institutions able to do so will likely create yet another government impediment to growth in the economy.

On one hand the administration is asking these banks to make credit more available to home buyers and home owners while simultaneously suing them for having done just that in the past. That kind of uncertainty and mixed-messaging is precisely what is hindering an economic turn-around.

If the government wants to place blame, a closer inspection of FHA, Fannie and Freddie, and progressive housing policies should be their focus.
The institutions so far named in the law suits are: Ally Financial, GMAC LLC (or what was GMAC), Bank of America, Barclays, Citigroup, Countrywide, Credit Suisse, Deutsche Bank, First Horizon , General Electric, Goldman Sachs, HSBC, JPMorgan Chase, Merrill Lynch, First Franklin Financial, Morgan Stanley, Nomura Holdings, The Royal Bank of Scotland(RBS), and Societe Generale

Fannie and Freddie: Dark Clouds Looming Over Near-Term Outlook

WASHINGTON, Aug. 22, 2011 /PRNewswire/ — The economy was hit by a barrage of disappointing news during the last month, which led to a significant downgrade in the overall macro economic forecast released today by Fannie Mae’s (OTC Bulletin Board: FNMA) Economics & Mortgage Market Analysis Group. While the August 2011 Economic Outlook does not forecast a double dip recession, the downgraded forecast reflects the Group’s view that the probability of another recession is close to a coin toss. For all of 2011, economic growth is expected to downshift to 1.4 percent from 3.1 percent in 2010. Growth is expected to pick up in 2012, but only to about 2.0 percent, compared with 3.1 percent projected in the July forecast.

“Key factors, including revisions to gross domestic product (GDP) data, have revealed that we have a bigger hole to dig out of, which explains the consumer angst over the lack of employment growth,” said Fannie Mae Chief Economist Doug Duncan. “Moreover, European financial market and fiscal policy turmoil, coupled with the U.S. debt ceiling debate, have hit on consumer confidence, which is at recessionary levels.”

“Macro economic factors are clearly driving the mindset of consumers and housing is being impacted by this,” Duncan continued. “However, housing has moved into second position behind general economic concerns among consumers, which is demonstrated in our National Housing Survey results. Our July data shows that 70 percent of Americans think the economy is on the wrong track, up from 60 percent a year ago. In turn, despite historically low interest rates, consumers are still saying they don’t see this as a good time to go out and borrow money to buy a house.”

Housing activity is expected to weaken along with the overall economy due to a renewed decline in business and consumer confidence and a softening hiring trend. One exception is the rental housing market. The rental vacancy rate (the share of rental housing that is vacant and for rent) plunged from 9.7 percent to 9.2 percent in the second quarter of 2011, the lowest rate in nine years. This is consistent with the declining trend in the homeownership rate, indicating that a rising share of households have shifted to renting over owning.

Fannie and Freddie Fatcats Still Raking in Taxpayer Dollars. $35M in Bonuses

Fannie Mae and Freddie Mac executives raked in over $35 million dollars in bonuses while sucking another $153 BILLION dollars out of taxpayers for being nothing more than an epic failure.

A report issued Thursday by the Federal Housing Finance Agency’s Office of the Inspector General shed some light on the following payoffs for incompetence, ineptitude or just plain theft of taxpayer dollars:

  • At Fannie Mae (Federal National Mortgage Association), its chief executive officer received $9.3 million in total compensation in 2009 and 2010, the report reveals. The CEO is Michael J. Williams, who joined the company in 1991.
  • At Freddie Mac (Federal Home Loan Mortgage Association), CEO Charles E. Haldeman Jr., former head of Putnam Investments, made $7.8 million in the two years since the company was taken over by the federal government.
  • Fannie Mae’s chief financial officer made $4.6 million, and its chief accounting officer/general counsel received $4.5 million.
  • At Freddie Mac, the CFO made $3.9 million, and the general counsel/secretary received $5.1 million
  • In all, the top six executives made $35.4 million. Meanwhile, total losses at the two companies could reach $363 billion through 2013, according to government estimates.

So who just keeps on authorizing these huge bonuses for the wholesale theft and abuse of taxpayer dollars? What the Federal Housing Authority  bureaucrats of course! Why does this kind of taxpayer dollar theft continue?  It is called Crony-Capitalism and is explained in detail here.

The stated mission of the FHFA responsible for this kind of fraud would be laughable, if not for the seriousness of this longtime Fannie and Freddie theft of taxpayer dollars. Their mission is *supposed* to be, to ensure that the fat-cat bonuses paid out to Senior execs at Fannie and Freddie are “reasonable.”   The taxpayers are on the hook for a total of $363 Billion dollars through 2013, and they give over $35 billion dollars to the people perpetuating this fraud under the guise of it being “reasonable?”  The FHFA Inspector general now says that Fannie and Freddie should install written criteria and procedures for performance evaluation in order to figure out what bonuses, if any, would be “reasonable” for these crony-capitalists. Oh Really? Why in the hell isn’t that type of system already in place ? So they just take $35 million tax dollars in bonuses, with no system in place to see if they actually earned it, and Congress is sitting on their hands letting this continue for decades.

Darrell Issa is the chairman of the House Government oversight committee, and where is he on this “oversight” of executive bonuses at Fannie and Freddie?  I am getting sick and tired of all these theatrical investigations in Congress that NEVER end up accomplishing a damn thing!  There is no stoppage of the theft of tax dollars over at Fannie and Freddie, even though we have seen what,  30, 40, or 50 so-called ” investigations ? ” If any action is ever taken, it is so ludicrous that it hurts me to even type it, such as giving someone a $50,000 fine for stealing 3 or 4 million in tax dollars.

U.S. taxpayers are on the hook for over $363 BILLION dollars through 2013, thanks to the corrupt fatcats over at Fannie and Freddie. Those same crony-capitalistic thieves were rewarded for their incompetence/ corruption with over $35 million dollars of your hard earned money. Think about that, as you write out that income tax payment check this month.

Whitehouse Ignores the Rule of law, refuses to report on Fannie and Freddie once again!

       The Whitehouse continues to stall on reforming the money train known as Fannie Mae and Freddie Mac, even though they are breaking their own so-called Financial Reform, ( also known as the Dodd-Frank Bill) laws to do it. This article is a part of the continuing exposure of the fraud, corruption and waste of taxpayer dollars by the F&F (Fannie and Freddie) club here at CDN.*

      While decades of fraud, corruption and shifty accounting practices have been exposed within the F&F club, our elected officials seem content to let it continue, from The Whitehouse, to Congress,and right on down to the U.S.  Treasury Department. Today we see another direct, in your face refusal to address this problem by none other than Obama’s own administration. I stumbled upon this latest act of  criminal behavior yesterday over at National Review Online.** I was stunned by the revelations in this article by Rep. Jeb Hansarling (R-TX).

“The Obama administration failed to release a report today on how Freddie Mac and Fannie Mae could be reformed, despite being required to do so by the Dodd-Frank law passed last summer.

Rep. Jeb Hensarling (R., Texas), who chairs the House Republican Conference, said in a statement that the White House’s failure to meet the deadline made it “crystal clear that the President is not serious about reforming Fannie Mae and Freddie Mac.”

As this writer reported earlier here at CDN, the GOP called for reform of the F&F club during the financial reform debate last year. Democrats flat out refused to even allow an amendment that would stop the abuse of taxpayer dollars through Fannie and Freddie. Now we have the Whitehouse, which happens to have approved the Democrats most recent blank check written to the F&F club, also breaking the law that required them to submit the report on how to stop the bleeding here. Amazing.

The Financial Services Committee isn’t too happy about this latest revelation either, as exposed further down in the same National Review Online article:

“Financial Services Committee chairman Spencer Baucus (R., Ala.) also criticized the administration, saying in a statement that “the Democrats always offer an excuse for not meeting deadlines, even those they themselves impose.”

I also mention the U S treasury department in my opening paragraph, and here is what I found at the bottom of the National Review Online article:

” A Treasury Department spokesman told Dow Jones Newswires that the administration hoped to release a report in February.”

Apparently, when it comes to reforming the malfeasance over at Fannie and Freddie, we are left with nothing more than the hope part of Obama’s Hope and Change campaign theme of 2008. There certainly is no change in the fraud, corruption, and outright theft of taxpayers dollars by the corruptocrats in bed with the criminal enterprise over at the F&F club.

 

* http://conservativedailynews.com/2011/01/fannie-freddie-and-foreclosures-exploring-the-true-costs-to-the-us-taxpayer/

   http://conservativedailynews.com/2011/01/money-for-nothing-and-houses-for-free/

** http://www.nationalreview.com/corner/258499/white-house-misses-deadline-freddie-mac-fannie-mae-report-katrina-trinko

Fannie, Freddie and Foreclosures- Exploring the True Costs to the US taxpayer

Introducing Fannie Mae, their mission and purpose as explained on fanniemae.com:

“Fannie Mae, (Federal National Mortgage Association) is a government-sponsored enterprise (GSE) chartered by Congress with a mission to provide liquidity, stability and affordability to the U.S. housing and mortgage markets.”

Yet they have managed to do just the opposite of the purpose for which they were created. With record numbers of foreclosures and mortgage problems being reported, I fail to see how I can paint this organization in any kind of favorable light here today.

Fannie Mae would have been in bankruptcy – if they actually applied the true principles within the realm of their creation, as further explained on their homepage (emphasis mine) :

“Fannie Mae was established as a federal agency in 1938, and was chartered by Congress in 1968 as a private shareholder-owned company.”  Yet once again, a company deemed “too big to fail” by our government was in effect bailed out by the U S taxpayers. Whatever happened to investors that do not monitor their investments properly, being made to accept the loss here? Why should our government step in and make the taxpayer bear this debt burden?

Introducing Freddie Mac should have been more aptly named Fannie Mae II, as their mission statements are virtually the same, as reported on freddiemac.com (emphasis mine).

“Freddie Mac was chartered by Congress in 1970 with a public mission to stabilize the nation’s residential mortgage markets and expand opportunities for homeownership and affordable rental housing. Our statutory mission is to provide liquidity, stability and affordability to the U.S. housing market.

Read that mission statement again, then ask yourself, “Have they accomplished their mission, or any part of it today? ” Again, I am trying to shed a positive light on Freddie Mac, but all I see are huge abject failures as to their own mission statement. I think the statement, “To stabilize the nation’s residential mortgage markets,” when looking at our mortgage foreclosure/ housing crisis of today, is ludicrous, to say the least. They claim to be playing an important role in helping people avoid foreclosure, yet at what price to the taxpayers and the economy?

Fannie and Freddie admit to 20 billion in losses.

While it is almost impossible to put a total cost to the taxpayers the full extent of the Fannie Mae and Freddie Mac GSE’s, ( Government Sponsored Enterprises) figures are now emerging that show us the enormity of the waste, abuse and corruption inherent in both of the organizations once again. Another fact that must be addressed is that Congress passed a “Financial Reform Bill” in July of last year that ignored the problems at Fannie and Freddie completely. How can you claim to reform the financial system and ignore the largest mortgage holder in the USA ? That just doesn’t make sense.

Earlier in the spring of 2010, Bloomberg Businessweek printed an article that tried to summarize the problems and expense of taxpayer funding through the government backing of Fannie Mae and Freddie Mac.* The fact that the Fannie and Freddie Foreclosure club is at the center of the housing crisis and financial collapse just cannot be denied. Note that this exposure was before they passed the financial reform bill. They knew the basic facts and chose to ignore them anyway.

When the history books are written about America’s early 21st Century financial system breakdown, what will they make of Fannie Mae and Freddie Mac? These two government-sponsored enterprises (GSEs) that own or guarantee 76 percent of all mortgage originations were at the center of the credit market collapse. Bailing them out has cost the U.S. taxpayer $145 billion and counting.” Estimates of their losses today run much, much higher as new facts emerge.

Keep in mind that this article was written in May of 2010, yet the costs to the taxpayer had already soared to $145 billion dollars. In an earlier article at CDN, “Money for Nothing and Your Houses for Free“, I pointed out how the taxpayer was also paying for the legal costs incurred by the top 3 corruptocrats at Fannie and Freddie, who continued to rake in huge salaries and bonuses after admitting to complicity in cooking the books and inflating the financial outlook at Freddie Mac to increase their bonuses. There appears to be an ever emerging pattern of corrupt practices within the higher ups in both organizations, and it certainly appears to have the approval of our elected officials in Congress, as they refuse to stop this madness mo matter how much proof is put in front of them.

Bloomberg Businessweek further goes on to state how with very little public discussion, or exposure in the media, “ Uncle Sam has basically nationalized their $5.5 trillion in home-loan assets. The Obama Administration has pledged to cover unlimited losses at Fannie and Freddie through 2012, a commitment that goes beyond a prior credit line of $400 billion (which itself had been doubled). In early May, Fannie posted a $13.1 billion loss while Freddie fessed up to losing $6.7 billion. The pair now tote $340 billion in nonperforming assets. ( 2012 also happens to be an election year, and without government protection, the people just might find out how bad this situation really is here, and that could have an enormous effect on said elections).

With all of the books being cooked to the point of complete confusion, I can’t fault the 111th Congress completely here, yet the bleeding of taxpayer dollars was very obvious, even to the most naïve and incompetent of government accountants. On May 11th of that same year Senator McCain called for the stoppage of the Fannie and Freddie debacle. What did the Democratic Majority in the Senate choose to do then? They ignored the calls for true reform at F&F and instead shifted responsibility to the Treasury Department to do some “studies” on how to take F&F off the taxpayers bank account. Meanwhile, record foreclosures, high unemployment, and an economic recession were crushing the country. Is this what the people voted for in the 2010 elections? This writer certainly doesn’t think it is.

There is also a Ginnie Mae, as in Government National Mortgage Association. (GNMA)

This company was originally a part of Fannie Mae and was originally created during the recovery from the Great Depression. This was widely known as the lending arm of HUD, or Housing and Urban Development. In 1968 Fannie Mae and Ginnie Mae split with Fannie Mae going public on the NYSE with Ginnie Mae remaining as a government owned association. So why haven’t we heard much about Ginnie Mae during this housing mortgage crisis in recent years? I plan on researching this entity more thoroughly in a upcoming article in this continuing saga. I can give a hint of what I have found so far on Ginnie Mae. It fits the same pattern as the other family members in the mortgage business attached to our government. One top executive was convicted of mortgage fraud at Lend America.. and continued to to help run the company, with the full endorsement of Ginnie Mae. In December of 2009 the FHA removed Ginnie-approved Lend America from the FHA program completely, mainly due to corruption, fraud and bad lending practices. Yes we have a definite pattern of corruption and incompetence emerging here in all three of these entities.

Fast forward to today. Fannie and Freddie still basically operate on a blank check written on the taxpayers bank account. The housing and mortgage crisis is still crippling our economy, yet I see no proposed legislation to put a stop to this debacle. We the people need to call up and write to our representatives and demand that the taxpayer funding of Fannie and Freddie be stopped immediately. A few Bernie Madoff-style criminal charges are also warranted here, to forcefully send the message that those responsible for this kind of debacle will be held accountable. With the recent announcement by the CBO of the 2011 Federal deficit hitting $1.5 trillion, immediate action is needed. Congress has all the data. No more“studies, no more “reviews”and no more dithering. Stop the bleeding of taxpayer dollars through Fannie and Freddie and do it now, there is no excuse for continuing to allow this massive fraud and abuse of taxpayer dollars.

Sources:

* http://www.businessweek.com/magazine/content/10_21/b4179025062530.htm
** http://conservativedailynews.com/2011/01/money-for-nothing-and-houses-for-free/

Money for Nothing and Houses for Free.

How would you feel if a burglar was caught inside your home stealing everything of value, and when the police went to make out the police report, you were told that you would have to write a check for $5000.00 to pay for the burglar’s legal fees? Well that happens indirectly, with the Lawyer-enriching “Right to Legal counsel” laws we have today. Those public defenders are not working for free. Another kind of this Lawyer – enriching thievery from the taxpayers was exposed this past week involving two companies whom I feel have as much culpability as Wall Street did in the housing crash of today. Meet Freddie Mac and Fannie Mae. These two companies announced that they want you the taxpayer to pay for their 160 million dollars in legal fees stemming from investigations of long-term fraud and corruption. With a new Republican majority in the House of Representatives today, it seems like Fannie and Freddie were/are trying to take in every single taxpayer dollar they can before serious investigations expose their dealings.

The New York Times ran a piece on this on 01/24/2011.* While this article does address some serious facts, it also seems to deny the responsibility of the top three executives to pay for their own legal fees stemming from years of their own corrupt, incompetent practices. The Times also refused to state the huge bonuses and salaries the top three culprits raked in right in the middle of the housing crisis. Here are a few observations from that article. Parenthesis at end are my comments.

The Times points out three key players in the story:

“Documents reviewed by The New York Times indicate that taxpayers have paid $24.2 million to law firms defending three of Fannie’s former top executives: Franklin D. Raines, its former chief executive; Timothy Howard, its former chief financial officer; and Leanne Spencer, the former controller.”

The story then demonstrates how for the last 4 years of Democratic rule, the House has done little, if anything to investigate the travesty, that both Freddie Mac and Fannie Mae have become:

“Since Fannie Mae and Freddie Mac were taken over by the government in September 2008, their losses stemming from bad loans have mounted, totaling about $150 billion in a recent reckoning. Because the financial regulatory overhaul passed last summer did not address how to resolve Fannie and Freddie, Congress is expected to take up that complex matter this year.”

Could it all be simple ineptitude?  Of course not – outright corruption is certainly another part of the problem:

“ Well before the credit crisis compelled the government to rescue Fannie and Freddie, accounting irregularities had engulfed both companies. Shareholders of Fannie and Freddie sued to recover stock losses incurred after the improprieties came to light.”

So here we have evidence of “accounting irregularities” resulting in lawsuits, yet instead of criminal charges and government intervention to stop the fraud, our Congress not only turns their heads the other way…But decides to put the taxpayers on the hook for the entire bill, as evidenced further in The Times article:

“Freddie’s problems arose in 2003 when it disclosed that it had understated its income from 2000 to 2002; the company revised its results by an additional $5 billion. In 2004, Fannie was found to have overstated its results for the preceding six years; conceding that its accounting was improper, it reduced its past earnings by $6.3 billion. Mr. Raines retired in December 2004 and Mr. Howard resigned at the same time. Ms. Spencer left her position as controller in early 2005. The following year, the Office of Federal Housing Enterprise Oversight, then the company’s regulator, published an in-depth report on the company’s accounting practices, accusing Fannie’s top executives of taking actions to manipulate profits and generate $115 million in improper bonuses. ( So they were found to be cooking the books to enrich themselves, paid fines that prove it, yet still feel the taxpayer should pay their legal fees? )

This is like a bad remake of the movie Groundhog Day here, where the mistakes and improprieties happen over and over again. When President Obama and the Democrats passed the partisan Financial Regulatory Reform bill last year, they also once again chose to ignore  the problems at F&F. That’s right, when Republicans tried to demand that the Financial Regulatory Reform bill include Fannie Mae and Freddie Mac, they were told told no. Coincidence? Everything happens for a reason, and I would like to hear the President’s and his  Democratic Party’s reason for allowing F&F to continue writing checks on the taxpayers account.

“Fannie Mae also settled a fraud suit brought by the Securities and Exchange Commission without admitting or denying the allegations; the company paid $400 million in penalties.” (Nothing to see here folks, just move on, but make sure you keep writing those checks drawn on the people’s Federal funds.)

When it comes to our Government today, we have such a bloated beauracracy that the checks and balances within Government, written into our  Constitution are being ignored. The “Federal Housing Finance Agency” agreed to pay for the proven fraudster’s legal fees?  What next?  Bernie Madoff being pardoned, so he may become the Secretary of the Treasury? Or maybe the Chairman of the Federal Reserve? Further on in The Times piece we see:

“After the government moved to back Fannie and Freddie, the Federal Housing Finance Agency agreed to continue paying to defend the executives, with the taxpayers covering the costs.”

So here we have proven fraud, corruption and incompetence within Fannie and Freddie, with absolutely nothing being done about it over the past eight years. Not one person has even been given criminal charges or jail time. Just the opposite, they still have that blank check written on the taxpayers account.  Seems to me it is pretty obvious here, as to why the people no longer trust their government.

Sources:

http://www.nytimes.com/2011/01/24/business/24fees.html?src=me&ref=business *