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(Reuters) - Fannie Mae (FNMA.OB), the nation's biggest mortgage finance company, on Thursday said it will pay $59.4 billion in dividends to the U.S. Treasury after a record profit in the first quarter that reflected a multibillion dollar tax-related gain.
http://www.reuters.com/...

This is the kind of news that infuriates Republicans.  Fannie Mae has long been their punching bag - many of even them blame the entire mortgage crisis on the two big GSE's (Freddie Mac is the other).  Republicans vowed to privatize Fannie Mae when they took the House in 2010.

Now Fannie Mae has repaid most of the emergency assistance it received:

The massive payment to the Treasury will reduce the net cost of Fannie Mae's taxpayer bailout to $21.1 billion.

It has received $116.1 billion in taxpayer funds since it and sibling Freddie Mac were seized by regulators in September 2008. By the end of June, it will have paid $95 billion in dividends to the Treasury for the government's stake.

Fannie Mae did this while reducing the mortgage payments of over one million homeowners an average of $3400 per year.  This is testimony to the competence of the Obama administration.

The US Treasury manages Fannie Mae while it is in receivership.  Rest assured, once repaid the GSE's will ask for their independence back.

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Comment Preferences

  •  Tip Jar (13+ / 0-)

    "The way to see by faith is to shut the eye of reason." - Thomas Paine

    by shrike on Thu May 09, 2013 at 09:27:26 AM PDT

  •  Great news... I hope this gets coverage (5+ / 0-)

    Thanks for posting!

     (and ignore the incoming "But Obama still sucks" crowd that will come in to re-explain this to you)

    Красота спасет мир --F. Dostoevsky

    by Wisper on Thu May 09, 2013 at 10:44:01 AM PDT

  •  This is really full of twisted Wall St spin... (4+ / 0-)

    Here's ProPublica's take of some it (5/3/13). (It's quite different from what you're reading in this post.) The reality is we'll never know how much the bailouts of Freddie and Fannie cost taxpayers. The Fed bought a lot of their toxic paper, with much of it still on their balance sheet. The government spent a tremendous amount making payments because it insured much of that bad paper, too. (That stuff's not even on the books anymore. And, it's not accounted for in any numbers you're putting forth here, either.)

    More from ProPublica (on 9/6/12) ...

    ...The fate of the Fannie and Freddie bailouts is even harder to figure, although the Treasury recently announced that all of the companies' profits from now on will be handed over to Uncle Sam each quarter. Their tabs should decrease, but how quickly and for how long they'll be allowed to exist is unclear...
    Your closing sentences are beyond shameless, frankly. Folks knowledgeable of what's actually going on would probably mock this community for someone actually putting these (see below) incredibly deceptive statements in a post here, too!
    ...Fannie Mae did this while reducing the mortgage payments of over one million homeowners an average of $3400 per year.  This is testimony to the competence of the Obama administration.

    The US Treasury manages Fannie Mae while it is in receivership.  Rest assured, once repaid the GSE's will ask for their independence back....

    The government is planning upon shutting down Fannie and Freddie. This has been on the boards in D.C. for quite awhile. (There are statements to that effect in the links from ProPublica, above. There's also a press release linked in the link[s] which indicates this, as well.)

    The money you're discussing here is, actually, "dividends" from the "investment." (Which was, actually, a full-blown bankruptcy and "re-nationalization of these GSE's.) By some accounts, the "investment" principal hasn't been paid back, at all!

    Last but not least, as a basic ethical responsibility to your fellow Kossacks, it's incumbent upon you to let them know--via honest disclosure, as you've done with me in comment threads in this community over the past few weeks--of your HEAVY BIAS with regards to all of this, since you earn you have earned your living in a related and sometimes-direct profession. ("Oh yeah, that!")

    Aside from that, misinforming the community of what's actually happening in Washington with regard to our nation's housing woes is just not cool!

    And, twisting numbers to obfuscate the greater truth that the large investors on Wall Street are really the only reason why prices are going up in many markets in the U.S. is the greater truth as some try to posit otherwise, too.

    Honestly, shrike?!?!?!? This post is pretty damn shameful!

    "I always thought if you worked hard enough and tried hard enough, things would work out. I was wrong." --Katharine Graham

    by bobswern on Thu May 09, 2013 at 11:05:53 AM PDT

    •  Arguably... (3+ / 0-)

      ...the single most incompetent and blatantly corrupt aspect of the administration's handling of the economy is there for all to see--and it has been there for all to see--very many years: It is our nation's mortgage/foreclosure fraud crisis. Even Tim Geithner's on record, both directly and tacitly, acknowledging this greater truth.

      "I always thought if you worked hard enough and tried hard enough, things would work out. I was wrong." --Katharine Graham

      by bobswern on Thu May 09, 2013 at 11:20:37 AM PDT

      [ Parent ]

    •  The GSE's can't be "shut down". (2+ / 0-)
      Recommended by:
      virginislandsguy, rukidingme

      Who would a borrower send their payment to for the next 25 years?

      They can be privatized.

      And ProPublica says they don't know exactly how much the GSE assistance has cost?  So what?  What does that prove?

      And the paper from the GSE's is not "toxic" - they never missed a bond payment.

      Your post has nothing of substance in it.

      "The way to see by faith is to shut the eye of reason." - Thomas Paine

      by shrike on Thu May 09, 2013 at 11:26:02 AM PDT

      [ Parent ]

      •  Your post is EXTREMELY deceptive and misleading... (1+ / 0-)
        Recommended by:
        Roger Fox

        ...starting with its headline...and it goes downhill from there.

        "I always thought if you worked hard enough and tried hard enough, things would work out. I was wrong." --Katharine Graham

        by bobswern on Thu May 09, 2013 at 11:27:53 AM PDT

        [ Parent ]

      •  They can be shut down. Borrowers (5+ / 0-)
        Recommended by:
        AoT, FG, virginislandsguy, Sandino, Roger Fox

        don't send payments to either agency. Borrowers send payments to their mortgage servicer, likely one of the money center or regional banks who service Fannie Mae or Freddie Mac loans. The agencies act as guarantors of mortgage securities, or investors in mortgages, or investors in mortgage securities. They don't service mortgages. If they were shut down that just means that the Treasury would make good on outstanding guarantees and that no more new mortgages would be swapped (guaranteed). It is a political question, not operational. The agencies could, operationally, shut down.

        •  Agreed about it being a political question (0+ / 0-)

          Their sheer size pretty much guarantees that will not be shut down abruptly. My preference is that, when the private mortgage market is functioning normally, that the GSEs be turned into closed funds.

          They also should take back the lucrative loan servicing from the banks. All profits would be routed to the Treasury until they've wound down their last loans.

          On the meta side, I want the stigma of renterhood (due to NAR propaganda) to go away. (Renter by choice here).

          There was only one joker in L.A. sensitive enough to wear that scent...and I had to find out who he was!

          by virginislandsguy on Thu May 09, 2013 at 01:08:33 PM PDT

          [ Parent ]

          •  Servicing can't be taken away. (2+ / 0-)
            Recommended by:
            virginislandsguy, Lying eyes

            It is an asset, with a value on the books that is marked to market by the banks. And if it were, who exactly is going to service the loans? Servicers have thousands of employees, so to "take back" servicing Fannie Mae would have to start a servicing platform and grow it, hiring tens of thousands in the process. Not something that they are going to do.

    •  I think your charges of bad faith (1+ / 0-)
      Recommended by:
      Lying eyes

      and intentional misdirection are inappropriate.  Unless you can back them up, it's not cool.

      •  I think you should read my first comment... (0+ / 0-)

        ...it pretty much speaks for itself. But, again, you'd have to read it to know that.

        "I always thought if you worked hard enough and tried hard enough, things would work out. I was wrong." --Katharine Graham

        by bobswern on Thu May 09, 2013 at 08:13:57 PM PDT

        [ Parent ]

  •  Thanks for the good news about the GSEs, shrike (1+ / 0-)
    Recommended by:
    Lying eyes

    But it seems the Doom and Gloomers™ here at DK just can't stand any good news about the economy. Perhaps it's due to their predictions (via NC and ZH of course) of trillions, trillions I tell you, of losses coming any day now.

    Keep up the good work. Illegitimi non carborundum.

    There was only one joker in L.A. sensitive enough to wear that scent...and I had to find out who he was!

    by virginislandsguy on Thu May 09, 2013 at 01:00:02 PM PDT

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