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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsFreddie Mac profit jumps; will pay U.S. Treasury $4.4 bln
Freddie Mac, the U.S.-owned mortgage finance company, on Wednesday said its second-quarter profit surged 65 percent to $5.0 billion, its second largest ever, as rising home prices limited credit losses and it booked big gains on derivatives that benefited from rising interest rates.
That big profit and another like it expected soon from larger sister Fannie Mae are fast becoming the centerpiece of the debate over housing-finance reform, which has languished since taxpayers stepped in to rescue the pair to the tune of nearly $188 billion during the financial crisis.
The fact that Freddie and Fannie have turned from taxpayer-financed money pits to cash cows for the federal budget is certain to complicate reform efforts just gaining momentum in Washington. The president weighed in on the issue on Tuesday, calling for a smaller government role in the mortgage market.
Freddie Mac, which has operated under federal conservatorship since it was seized in 2008 during the financial crisis, said that based on its net worth of $7.4 billion, it will make a dividend payment of $4.4 billion to the U.S. Treasury as part of the reimbursement for its rescue aid.
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http://www.reuters.com/article/2013/08/07/usa-freddiemac-results-idUSL1N0G80GK20130807
leftstreet
(36,108 posts)He proposed to wind down Fannie Mae and Freddie Mac, for the first time outlining his approach to overhauling the two giant mortgage-finance companies that were taken over by the government when they failed nearly five years ago. The companies, which Mr. Obama described in an appearance here as not really government, but not really private sector, recently began to repay taxpayers.
http://www.nytimes.com/2013/08/07/us/politics/obama-fannie-mae-freddie-mac.html?_r=0
ProSense
(116,464 posts)It is not government-owned.
The two companies have paid nearly $132 billion in dividend payments. Freddie expects to pay the Treasury the $4.4 billion dividend payment by September, bringing Freddie's total to roughly $41 billion as the amount of dividends it will have paid to the Treasury. The company has drawn $71 billion in federal aid, which leaves taxpayers on the hook for about $30 billion.
The administration is proposing a way out of the bailout status and to ensure no furture bailouts.
cali
(114,904 posts)uniquely qualified to perform. You should stop it. Claiming it's just like AIG is false. You know that. What you're doing is inexcusable.
AIG is a wholly private corporation.
http://en.wikipedia.org/wiki/AIG
Freddie Mac is a public/private hybrid. It was created by Congress.
It's a GSE.
A government-sponsored enterprise (GSE) is a financial services corporation created by the United States Congress. Their intended function is to enhance the flow of credit to targeted sectors of the economy and to make those segments of the capital market more efficient and transparent, and to reduce the risk to investors and other suppliers of capital. The desired effect of the GSEs is to enhance the availability and reduce the cost of credit to the targeted borrowing sectors primarily by reducing the risk of capital losses to investors: agriculture, home finance and education. The two most well known GSEs are the Federal National Mortgage Association, or Fannie Mae, and the Federal Home Loan Mortgage Corporation, or Freddie Mac.[1]
Congress created the first GSE in 1916 with the creation of the Farm Credit System; it initiated GSEs in the home finance segment of the economy with the creation of the Federal Home Loan Banks in 1932; and it targeted education when it chartered Sallie Mae in 1972 (although Congress allowed Sallie Mae to relinquish its government sponsorship and become a fully private institution via legislation in 1995). The residential mortgage borrowing segment is by far the largest of the borrowing segments in which the GSEs operate. GSEs hold or pool approximately $5 trillion worth of mortgages.[2][3][4] For a comprehensive list of articles discussing Fannie Mae, Freddie Mac, and Government-Sponsored Enterprises, see Fannie Mae and Freddie Mac: A Bibliography.[5]
http://en.wikipedia.org/wiki/Government-sponsored_enterprise
http://home.howstuffworks.com/real-estate/mortgage16.htm
http://www.economist.com/node/15011307
http://www.americanprogress.org/issues/housing/report/2012/09/06/36736/7-things-you-need-to-know-about-fannie-mae-and-freddie-mac/
http://www.washingtonmonthly.com/archives/individual/2008_07/014108.php
"not even close. stop putting misinformation out. it's a disservice that you appear to uniquely qualified to perform. "
...damn well it's not "misinformation," as I pointed this out to you in another thread.
http://www.democraticunderground.com/10023417828#post53
cali
(114,904 posts)posting utter misinformation- to put it kindly- when you claim it's just like AIG or other private corporations.
I've provided you with a slew of links that are definitive.
STOP POSTING MISINFORMATION. It's reprehensible.
ProSense
(116,464 posts)cali
(114,904 posts)no matter what you falsely claim, anyone clicking on the links can quickly discern just what you are up to with your misinformation campaign.
I've posted PROOF from government sites that you are being less than honest when you say it's just like any other private corporation- like AIG.
I fear for you. honestly. You're down the rabbit hole.
ProSense
(116,464 posts)"They are not strictly private and I've posted proof of that so no matter what you falsely claim, anyone clicking on the links can quickly discern just what you are up to with your misinformation campaign."
..."strictly" is semantics. Do you think the government should continue funneling money into these entities:
Fannie, Freddie execs score $100 million payday
http://money.cnn.com/2011/11/15/news/companies/fannie_freddie_executive_pay/
Here is the current CEO:
As President and CEO, Mr. Mayopoulos is focused on ensuring that the company continues to manage its legacy issues effectively, while driving the companys contributions to creating a better housing finance system for the future. Under his leadership, Fannie Mae will continue to play an essential role in funding the market, assisting troubled homeowners, strengthening communities, and repaying taxpayers investment in the company.
Mr. Mayopoulos brings more than 25 years of experience to his leadership post. He joined Fannie Mae in April 2009 as executive vice president, general counsel, and corporate secretary and was appointed chief administrative officer in 2010. Prior to joining Fannie Mae, Mr. Mayopoulos was executive vice president and general counsel of Bank of America Corporation. Previously, he served in senior management roles at Deutsche Bank AG, Credit Suisse First Boston, and Donaldson, Lufkin & Jenrette, Inc. Earlier in his career, Mr. Mayopoulos was in private practice. He is a graduate of Cornell University and the New York University School of Law.
http://www.fanniemae.com/portal/about-us/company-overview/leadership/mayopoulos.html#
cali
(114,904 posts)GSEs are public/private hybrids and nothing like AIG. It's not semantics. It's a fact. You need to stop making your false claims which you do in order to mislead people. It's reprehensible.
Created by Congress. Got that? They would not exist if it weren't for the Federal Government. And individual or consortium can't create one. Freddie is publicly chartered.
A government-sponsored enterprise (GSE) is a financial services corporation created by the United States Congress. Their intended function is to enhance the flow of credit to targeted sectors of the economy and to make those segments of the capital market more efficient and transparent, and to reduce the risk to investors and other suppliers of capital. The desired effect of the GSEs is to enhance the availability and reduce the cost of credit to the targeted borrowing sectors primarily by reducing the risk of capital losses to investors: agriculture, home finance and education. The two most well known GSEs are the Federal National Mortgage Association, or Fannie Mae, and the Federal Home Loan Mortgage Corporation, or Freddie Mac.[1]
Congress created the first GSE in 1916 with the creation of the Farm Credit System; it initiated GSEs in the home finance segment of the economy with the creation of the Federal Home Loan Banks in 1932; and it targeted education when it chartered Sallie Mae in 1972 (although Congress allowed Sallie Mae to relinquish its government sponsorship and become a fully private institution via legislation in 1995). The residential mortgage borrowing segment is by far the largest of the borrowing segments in which the GSEs operate. GSEs hold or pool approximately $5 trillion worth of mortgages.[2][3][4] For a comprehensive list of articles discussing Fannie Mae, Freddie Mac, and Government-Sponsored Enterprises, see Fannie Mae and Freddie Mac: A Bibliography.[5]
http://en.wikipedia.org/wiki/Government-sponsored_enterprise
ProSense
(116,464 posts)From your link:
Housing[edit source]
The twelve Federal Home Loan Banks (FHLBanks) (1932)
Federal National Mortgage Association (Fannie Mae) (1938)
Federal Home Loan Mortgage Corporation (Freddie Mac) (1970)
Financing Corporation (FICO) (1987)
See that date: 1938?
Follow the link, and you'll find this:
It was acquired by the Housing and Home Finance Agency from the Federal Loan Agency as a constituent unit in 1950.[9] In 1954, an amendment known as the Federal National Mortgage Association Charter Act[10] made Fannie Mae into "mixed-ownership corporation" meaning that federal government held the preferred stock while private investors held the common stock;[5] in 1968 it converted to a privately held corporation, to remove its activity and debt from the federal budget.[11] In the 1968 change, arising from the Housing and Urban Development Act of 1968, Fannie Mae's predecessor (also called Fannie Mae) was split into the current Fannie Mae and the Government National Mortgage Association ("Ginnie Mae" .
Ginnie Mae, which remained a government organization, supports FHA-insured mortgages as well as Veterans Administration (VA) and Farmers Home Administration (FmHA) insured mortgages. As such Ginnie Mae is the only home-loan agency explicitly backed by the full faith and credit of the United States government.[12]
It's private.
cali
(114,904 posts)Even the U.S. government designates it as such.
Now I'll let you have the last words as it's clear that you won't let reality interfere with your mission.