Fannie - Freddie News

[Francois K. Gregoire]

Hi All,

Not quite sure if this it where this belongs, but with all the discussion of Fannie and Freddie, AVMs and No Appraisal Loan Prgrams, this seems as logical a place as any.

BLAST FAX: Fannie and Freddie a Risky Bet for US Taxpayers

http://www.fmwatch.org/resources//2002-01-14.120.phtml

Fannie and Freddie defend themselves against negativity

http://washington.bcentral.com/washington/...ewscolumn2.html

Lenders Criticize Fannie, Freddie - Diversity in Funding Faulted

http://www.washingtonpost.com/ac2/wp-dyn?p...34515-2001Dec12

 

[Fred]

Frank,

I have checked out FM Watch occasionally. They sound a bit like a supermarket tabloid.

Some months back, I noticed several errors on their web site reports, like a statement that there were 8,000 RE appraisers. I emailed them and they responded. They said they would change the 8,000 figure, but that other mistakes were not their fault because they got the information from sources believed reliable.

FM Watch always gives me the feeling that they have an ax to grind. Consider this:
“This debt has been issued chiefly to fund a lucrative investment portfolio…In 2000, both GSEs reported that this arbitrage investing accounted for approximately 60 percent of their net income.”
And
“With such low capital, the GSEs simply do not have room to gamble in the complex derivatives markets.”

Notice how it’s called “lucrative” and “investing” when FMW wants to gig the GSE’s for making too much money in non-loan activities. Then in arguing why it should stop, it’s called a “gamble” in “derivatives.”

I think the GSE situation bears close scrutiny, but I don’t trust these FMW reports. I get the feeling that if the GSE’s backed off arbitraging, an activity that the report says accounts for 60% of the Net Income, FMW would be sounding sirens about the falling earnings.

Steven Santora, IFAS

 

[Fred]

Wow, if you use regular quotation marks, a number tag appears. That kind of makes the post look like its written in Martian.

 

[Francois K. Gregoire]

Frank,

I have checked out FM Watch occasionally. They sound a bit like a supermarket tabloid.

Steve,

Agree with your assessment of FM Watch. Like you I visit them once in a while. Some of the information is entertaining, but I've not made an effort to verify. They most definately have an axe to grind with the GSEs.

Once in a while there is a good link. Perhaps there should have been a disclaimer in my post.

 

[Fred]

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