Wise Man
9 hours ago
All the FHFA directors could have been fired on the spot at any time "for cause", because of the multiple statutory violations, beginning with the issuance of $1B SPS for free on day one, that reduced the core capital in the same amount, both a capital distribution restricted (like today's) and a breach of the conservator's Rehab power.
Then, allowing dividend payments that deplete capital or even prompted the losses and the need to tap the UST for Equity funds (SPS) in numerous occasions, during a Conservatorship established for Critically Undercapitalized enterprises.
SPS LP "increased", instead of SPS "issued/purchased" in order to evade the December 31, 2009 deadline on purchases in the authority of UST.
Etc.
Unless there is a Separate Account plan using the exceptions to the Restriction and the Incidental Power of the conservator, better known as the Zing! power, "any action", and, in truth, they were assessments sent to UST through a separate account, 1989 FHLBanks-style.
This conspiracy went wrong since FnF pay dividends on SPS, not interests, and thus, as dividends are restricted, the entire assessment was applied toward the exceptions to the restriction in order to legalize it. Fist, repayment of SPS, then the Recap habilitated by DeMarco (The fixed-it man) in the July 20, 2011 Final Rule (exactly the date of Time Limitation as Acting Director -FVRA-, which shows intentionality to make this follown-on plan enforceable) CFR 1237.12, and not like the FHLBanks that had to pay first a $300 million annuity in interests on RefCorp bonds (10% interest rate with a 0.299% spread over Treasuries at the time -GAO report-), the rest is what repays the principal of the bond, unless what they did instead, was to use the excess amount to pay the 40-year interest-only installments sooner, when the law states that it should have been applied towards the payment of the principal sooner. Oops!
"Completion of the RefCorp obligation", the FHFA solemny announced in 2011 (Source). "The FHLBanks fulfilled their obligation to pay interests."
The $30B principal, max. legal amount tapped by Sandra Thompson at the FDIC at the time, with DeMarco at the auditor GAO, was still outstading, until $SVB came along.
The cumulative dividend rate on SPS has been estimated at a weighted-average 1.8% rate, with a 0.5% spread over Treasuries in each quarterly investment in SPS and taking into consideration the partial quarterly repayments, complying with the original terms in the UST backup of FnF in the Charter Act.
Although it's netted out with the interests that the UST owes to FnF on the $152B cash refund due.
Both schemes are so similar, that the NWS dividend was enacted when the 10% dividend prompted the losses mentioned before, in order to capture the any FHLBank with a net loss for a quarter is not required to pay the REFCORP assessment for that quarter, in this excerpt taken from a FHLB's Earnings report at the time explaining the entire scheme:
BOTTOM LINE
They were assessments sent to Treasury under the guise of capital distributions, 1989 FHLB-style. But the 10% rate back then, can't be a rate during 2008-2010.
There is no "contract" or "dividend obligation".
Wise Man
11 hours ago
Bill Ackman is exposed. The thread below explains the factors that determine the current stock valuation, and for the different share classes.
Remember that Ackman is in the epicenter of the Fanniegate conspiracy, when he refers to the current NWS 2.0 as "FnF continue to build capital through Retained Earnings", a big lie based on the Financial Statement fraud in FnF. Adjusted for the gifted SPS LP and its offset, absent from the Balance Sheets, the RE just built (CET1), is wiped out or, I should say, held in escrow (image shown in one of the tweets below) in order to comply with the "Recap FnF" in the exceptions 1, 2, 3, 4 to the Restriction on Capital Distributions (SPS LP increased for free as compensation to UST in the absence of dividends, appears as #1 in the statutory definition of capital distribution), seen in the CFR 1237.12, the "(c) the supplemental" of the one by statute U.S. Code 4614(e).
Something repeated by Sandra Thompson in her recent testimony to the Senate.
ST changed it in the FHFA 2023 Report to Congress released a few days ago, for "FnF continue to build Net Worth through Retained Earnings", because she thought that "capital", that refers to "Capital Reserve", can't be said if it's an invalid Capital metric in FnF (ERCF). Still a lie. FnF build NW, but it's SPS, not Retained Earnings account which is the only item necessary for the "Rehabilitate FnF" required by Justice Alito and one of the boxes in the Fed's Jerome Powell's 3-box checklist that he pointed out for the pending proposed Capital Rule for the banks:
1- Capital ratios.
2- Enough liquidity.
3- A plan to take the losses that you are going to take in the future. That would be Retained Earnings account (Balance Sheet = Picture of a company at a determined date) that absorbs the future losses that will come from the Income Statement -Net Income during a period-, currently adjusted $-216B in FnF, but $252B under the Separate Account plan (after the Treasury Stock -stock buybacks- is retired).
He also implied that the Supreme Court said that FHFA has absolute discretion in its actions. The hedge funds' playground. Another lie. More if he is interpreting an Incidental Power to come to that conclusion.
Here is shown a thread comprised of 4 tweets, debunking another gaffe in his GSE slides: "The common stocks of FnF are permanent options". Later he portrays himself as an options trader expert on Twitter. He is capable of paying for a SA article to push his flawed stance.
No one in his right mind says that a security converts to a different security.
The underlying security in a Preferred is a fixed-income security(an obligation to be more precise).
But the specifications of the same fixed-income security have changed. Now 0-coupon (div suspended) pic.twitter.com/yiTpUiq4Kd— Conservatives against Trump (@CarlosVignote) June 30, 2024
On the other hand, the driver for JPS,is:
-The $402B Core Capital shortfall mentioned before,plus 25% of Prescribed C.Buffer marks the day of div resumption👇and par value valuation.
Hence,17yrs more, at 6% discount rate= $9 in $FNMAS.
Every yr,17yrs(Sweep)→$4.5@TheJusticeDept pic.twitter.com/bDFVns9whh— Conservatives against Trump (@CarlosVignote) June 30, 2024
I'm not surprised to see that one of the recruiters for the Bitcoin scam (an unbacked token trading on Stock Exchanges), was also chosen for the Fanniegate scandal.