More green shootin' fun: Fannie Mae default rates hockey sticking?

[c1ue]

From: http://www.calculatedriskblog.com/20...ency-rate.html

FannieMaeDelinquency.jpg

When will the 'second derivative' turn positive?

Fannie Mae reported that the serious delinquency rate for conventional loans in its single-family guarantee business increased to 4.17 percent in July, up from 3.94 percent in June - and up from 1.45% in July 2008.

"Includes seriously delinquent conventional single-family loans as a percent of the total number of conventional single-family loans. These rates are based on conventional single-family mortgage loans and exclude reverse mortgages and non-Fannie Mae mortgage securities held in our portfolio."

[vinoveri]

Re: More green shootin' fun: Fannie Mae default rates hockey sticking?

Fannie is gov owned and controlled. What's the big deal? Nothing of consequence, "Strategic Defaults" and all that.

Think about it, do you really seen Uncle Sam foreclosing on all those helpless needy homeowners. Easier to write down the principal and restucture the mortgage (and of course make whole any of the creditors via Treasury infusion)

[thunderdownunder]

Re: More green shootin' fun: Fannie Mae default rates hockey sticking?

The question needs to be asked,
What is the percentage of Net Profit that FM make on outstanding and conforming loans. my guess is it is about 3%.
If 4% of all loans are bringing in zip then your in a loss making situation.
Then add in declining asset prices that you hold as collateral and I feel a migraine coming on. Derivate that and pray in earnest for massive inflation to come riding to your rescue. :eek: Oh thats right, Inflation by bubble got us here, QUICK ring GS and hire their Bubble Machine back.

[swgprop]

Re: More green shootin' fun: Fannie Mae default rates hockey sticking?

The question needs to be asked,
What is the percentage of Net Profit that FM make on outstanding and conforming loans. my guess is it is about 3%.
If 4% of all loans are bringing in zip then your in a loss making situation.
Then add in declining asset prices that you hold as collateral and I feel a migraine coming on. Derivate that and pray in earnest for massive inflation to come riding to your rescue. :eek: Oh thats right, Inflation by bubble got us here, QUICK ring GS and hire their Bubble Machine back.

Only lost 58 Billion last year, what's the big deal?

		2008.00
		(Dollars in millions, except per share
		amounts)
Net interest income		$8,782
Guaranty fee income			7,621
Trust management income (2)			261
Fee and other income			772
Net revenues		$17,436
Losses on certain guaranty contracts
Investment losses, net			(7,220)
Fair value losses, net (3)			(20,129)
Losses from partnership investments			(1,554)
Administrative expenses			(1,979)
Credit-related expenses (4)			(29,809)
Other non-interest expenses (5)			(1,294)
Income (loss) before federal income taxes			(44,549)
and extraordinary gains (losses)
(Provision) benefit for federal income			(13,749)
taxes
Extraordinary (losses) gains, net of tax			(409)
effect
Net (loss) income		($58,707)
Diluted earnings (loss) per common share		($24.04)

[c1ue]

Re: More green shootin' fun: Fannie Mae default rates hockey sticking?

Fannie is gov owned and controlled. What's the big deal? Nothing of consequence, "Strategic Defaults" and all that.

Think about it, do you really seen Uncle Sam foreclosing on all those helpless needy homeowners. Easier to write down the principal and restucture the mortgage (and of course make whole any of the creditors via Treasury infusion)

Sure, of course, that makes perfect sense.

Let's take the taxpayers money, buy back mortgages which are tax subsidized, and write down the balance due.

After all, deficits don't matter.

And inflation is always a monetary phenomenon.

[GRG55]

Re: More green shootin' fun: Fannie Mae default rates hockey sticking?

Only lost 58 Billion last year, what's the big deal?

Still writing 125% LTVs. What's changed? :p

News Release

WASHINGTON, DC -- Fannie Mae (FNM/NYSE) announced today that the company is providing information to servicers regarding changes to the Home Affordable Refinance Program (HARP) that permits refinancing of existing Fannie Mae loans with loan-to-value (LTV) ratios up to 125 percent. The loans will be eligible for delivery on or after September 1, 2009...

[cjppjc]

Re: More green shootin' fun: Fannie Mae default rates hockey sticking?

Still writing 125% LTVs. What's changed? :p

News Release

WASHINGTON, DC -- Fannie Mae (FNM/NYSE) announced today that the company is providing information to servicers regarding changes to the Home Affordable Refinance Program (HARP) that permits refinancing of existing Fannie Mae loans with loan-to-value (LTV) ratios up to 125 percent. The loans will be eligible for delivery on or after September 1, 2009...

Well this is more of a mortgage restructuring than anything else.

[MulaMan]

Re: More green shootin' fun: Fannie Mae default rates hockey sticking?

In U.S.S.R we solve problem by give free home to all patriotic party member in priority:

1. Top party member: congress or senator friend -> 5 bedroom + pool
2. Married Party member with kids and good christian -> 4 bedroom + 2 bath
3. Single Party member with kids and christian -> 2 bed + 2 bath
4. Party member, christian, no kids -> condo
5. Non-Party member or non-christian -> mortgage refi 4% for 30 yrs.
6. Athiest or Muslim -> must rent or repent.

[vinoveri]

Re: More green shootin' fun: Fannie Mae default rates hockey sticking?

Sure, of course, that makes perfect sense.

Let's take the taxpayers money, buy back mortgages which are tax subsidized, and write down the balance due.

After all, deficits don't matter.

And inflation is always a monetary phenomenon.

I suppose I should have included a :rolleyes: in my post.

I've thrown in the towel on believing in "free markets", e.g., that deficits do in fact matter, for up till now they don't appear to (and given what's happened in the last year with all the coordinated printing ... if that wasn't the straw to break the camel's back, then what will be?)

Unfortunately, it does make sense.
Without an immiment threat of the Treasury bond market collapsing and/or a $ currency crisis, why would the gov not do this? Do the savers outnumber the debtors? Are they informed enough to understand the negative consequences of these actions and motivated enough to "stop" the government? My take is NO and NO